Bernard Arnault has taken a personal equity stake in Cartier parent Richemont, according to people familiar with the French billionaire’s investments.
It is unclear exactly how many shares the LVMH chairman and CEO acquired in Cie Financiere Richemont SA. It was described by one of the people as “small” and part of a broader portfolio of investments in listed companies owned by the Arnault family.
Arnault currently plans to hold the shares only as an investment, said the person, who asked not to be named talking about confidential matters.
News of Arnault’s shareholding in Richemont, which is controlled by South African billionaire Johann Rupert, was revealed as part of a wider profile of the businessman published in Bloomberg Working week.
Richemont shares rose as much as 3.1 percent in Zurich, although they are down 2.4 percent in the past 12 months. LVMH traded 0.7 percent higher in Paris.
A representative for Arnault and LVMH Moët Hennessy Louis Vuitton SE declined to comment.
LVMH, the largest global supplier of high-value goods, is Europe’s third most valuable company, with a market capitalization of around €366 billion ($391 billion). Richemont’s market value is 84.7 billion Swiss francs ($91.3 billion).
Arnault’s shareholding in Richemont could still raise questions about his intentions with the investment. Richemont has a strong defense against unwanted suitors because its chairman, Rupert, controls 51 percent of the voting rights despite owning only 10.2 percent of the capital. In recent years, Rupert, who is 74, has emphasized his desire to keep the group independent.
As of March 31, there were no other significant shareholders in Richemont holding at least 3 percent of the voting rights, the Swiss-based company said in its latest annual report.
Arnault, 75, described Richemont’s Cartier and Van Cleef & Arpels as “two great brands” during LVMH’s annual results presentation in January. He also praised Rupert’s management of the company.
“Let me end with Richemont and Monsieur Rupert, whom I consider an exceptional leader,” Arnault said at the time. “I have no desire to disrupt his strategy, I understand that he wants to remain independent and I think that is very good. And if he needs support to maintain his independence, I will be there.”
Fourteen years ago, LVMH invested in the French luxury house Hermes International SCA. Arnault’s company used equity derivatives to secretly build a stake that eventually reached 23 percent, shocking the family behind Hermes. Arnault called the move ‘friendly’ at the time. The target fought back and fended off LVMH, which divested its stake in the Birkin bag maker.
LVMH owns companies such as Loewe, Celine and Fendi in fashion, as well as cosmetics retailer Sephora and the brands Dom Perignon and Moët & Chandon Champagne. The last major acquisition was the $16 billion purchase of Tiffany & Co over three years ago, which remains the largest deal in the luxury industry to date.
LVMH also owns the jewelry brands Bulgari, Fred, Chaumet and Repossi, so if Arnault ever planned a takeover of Richemont, a union could potentially draw antitrust attention. LVMH fashion brands Louis Vuitton and Christian Dior Couture also have jewelry lines.
As of June 24, Arnault’s net worth was estimated at approximately $203 billion, placing him third behind Jeff Bezos and Elon Musk, according to the Bloomberg Billionaires Index.
By Angelina Rascouet
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