26 Dec 2010, Posted by admin in Fashion, 1 Comments

LVMH vs. Hermès, the timeline

The battle between Hermès and LVMH is shaping up to be this century’s version of War of the Roses (except this battle is over a company that produces bags that are priced upwards of $10,000). Here is the timeline of events so far. As this battle is far from over, rest assured, we’ll be updating.

10/23/2010 LVMH buys 14.2% Hermès and issues the following statement: “LVMH has no intention of launching a tender offer, taking control of Hermès nor seeking board representation. The objective of LVMH is to be a long-term shareholder of Hermès. LVMH fully supports the strategy implemented by the founding family and the management team.”

10/26/2010 LVMH increases stake in Hermès to 17.1% using derivatives called equity swaps.

11/2/2010 Hermès CEO Patrick Thomas and Hermès descendent Bertrand Puech grant an interview to the French daily Le Figaro. Thomas directing a remark to LVMH CEO Bernard Arnault says, “If you are indeed friendly Mr. Arnault, you have to go.”

11/4/2010 Bernard Arnault responds in Le Figaro, “I don’t see how the head of a publicly traded company is qualified to ask an investor to sell his shares.” Arnault went on to say, “We’ve taken a stake in Hermès for the long term. This operation is a completely amicable one, what’s hostile is the demand that we sell our shares.”

11/5/2010 French stock market regulators open an official problem into LVMH’s purchase of 17.1% of Hermès. State that the aim of the probe is to ensure that LVMH respected all the necessary regulations when building its stake.

12/3/2010 Hermès family shareholders meet to discuss how to handle LVMH’s purchase of Hermès shares. Family members own 73.4% of the company. There are around 60 family shareholders, and none owns more than 5% of the company.

12/5/2010 Hermès family shareholders announce that to fend off LVMH’s advances they are pooling their shares into a holding company that will control more than 50% of the share capital. French newspaper Le Monde reports the same day that a family shareholder sold off 1% of the company the previous week bringing the family stake in the French luxury house to just under 72%.

12/22/2010 LVMH scoops up more shares of Hermès, now has a 20.21% stake in the company.

–Leah Bourne