Louis Vuitton (LVMH) announced last week that it owns 20.21% of Hermes, after having discreetly built up a 17.1% stake starting in 2008, mainly via derivatives! Hermes decided earlier this month to try and create a holding that would allow the family shareholders to control more than 50% of equity. This would defend Hermes against LV’s unwelcome purchase of its capital. Legally, shareholders, once united through a pact or a holding, need to launch a buyout of other shareholders once their holding climbs above 33%. However, under certain circumstances, they may obtain a waiver from the AMF (french market regulators). The French association of minority shareholders has already said it opposed Hermes getting a buyout waiver from the AMF, but the actual debate will not commence until Thursday, and the final decision may not come for another 15 days! Hermes family shareholders, which number around 60, and together own about 73% of the company, have called for Bernard Arnault, LV’s controlling shareholder and chief executive, to withdraw from its capital. This was a very shady move from Mr. Arnauld and Louis Vuitton… but you have to give him credit for being a smart businessman! Soon your Birkin bag may have that signature “LV” logo all over it with a much cheaper price tag! hmmm…(thefashionreporter.)
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