France’s LVM H acquires stake in Hermes for $2-bn
25 Oct 2010
The world' s largest luxury goods group LVMH Moet Hennessy Louis Vuitton SA announced Saturday that it has agreed to acquire 17-per cent stake in smaller but trendy rival Hermes International SA for approximately €1.45 billion ($2 billion).
LVMH bought 15 million shares of Hermes, representing 14.2-per cent stake in the company. Further, the company holds convertible derivatives of over 3 million shares or 2.9 per cent in Hermes, which it intends to convert, LVMH said Saturday in a statement.
Through the deal, LVMH' s total shareholding in Hermes would be over 18 million shares or 17.1 per cent, at a cost of €1.45 billion.
The luxury goods giant said that it has no intention to launch a takeover bid for Hermes, nor seek board representation.
Paris-based LVMH, created in 1987, is a world leader in luxury goods, possessing a unique portfolio of over 60 prestigious brands. Its five operating segments include wines and spirits, fashion and leather goods, perfumes and cosmetics, watches and jewelry, and selective retailing.
LVMH brands include wine producer Chateau d' Yquem, luxury goods brands Louis Vuitton, Fendi and Givenchy, TAG Heuer watches, and Christian Dior perfumes.
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