Object of desire
Bernard Arnault, the billionaire head of French luxury goods group LVMH, once dismissed a question about a rival group, saying: far as competitors, there are two I admire: Chanel and Herm was soon after Mr Arnault tenacious war for control of Gucci, the Italian leather goods maker, ended in rare defeat at the hands of arch rival Fran Pinault PPR group (now known as Kering) more than a decade ago.
The hand stitched leather gloves have come off in a hostile duel between the 176 year old Herm and 26 year old LVMH, involving not only one of the world richest, most controversial and private men but also the biggest shake up in a decade in France luxury goods industry the world largest.
The story began one Saturday morning in October 2010 when Patrick Thomas, Herm chief executive, was riding his bike in the Auvergne countryside. His mobile phone rang. It was Mr Arnault, telling him that LVMH had acquired 17 per cent of Herm in a stock market operation. The news stupefied its high quality designer replica handbags controlling family, which holds 72 per cent.
The Herm family called LVMH audacious swoop on almost two thirds of its free float through the stealthy use of derivatives an They also regarded it as an unacceptable way of doing business. As Pierre God Mr Arnault right hand man, says, LVMH will wait century, maybe two for Herm Perfect Quality Louis Vuitton Replica is no doubt that it has been a great investment: LVMH is sitting on paper profits of from its canny bet during the 2008 market meltdown. Next, Mr Arnault sees synergies through co operation.
Then there is Mr Arnault magpie attraction to glister. cannot see a beautiful brand without wanting it, says a person who knows both sides and did not replica louis vuitton bags from china wish to be named. Casanova, he must possess them all it a compulsion with him. We are not luxury. We are high quality, based on exceptional artisanal work
Mr Arnault business nest is stuffed with treasure more than 60 cheap louis vuitton bags from china uk brands including Christian Dior, Louis Vuitton, C Loewe, Givenchy and Berluti in fashion and leather goods; Guerlain perfumes; Bulgari and Chaumet in jewellery, while in spirits and champagne LVMH owns Dom P Krug, Ch d Cheval Blanc and Hennessy.
Acquiring Herm would not only give Mr Arnault the world most desirable handbag aaa replica designer handbags manufacturer prices start at about but it would also complement Louis Vuitton, where prices are similar to Gucci at Discount Replica Louis Vuitton Bags an average of about and where sales have slowed sharply.
From Herm perspective, a takeover by LVMH would mean the slow death of the high quality replica handbags china company founded by Thierry Herm a German born harness maker to European noblemen who set up shop in Paris in 1837.
The company, which still hand stitches most of its bags, regards itself as one of the last bastions against the industry descent into what it calls masstige the mass production of prestige goods.
LVMH brash, flashy approach to luxury is anathema to Herm new recruits at Louis Vuitton play a board game in cheap louis vuitton bags from china which one of the questions is to name as many celebrities as possible in its advertisement campaigns.
The style of leadership is also different. At Herm Paris Faubourg Saint Honor flagship store, the charismatic shadow of family patriarch Jean Louis Dumas still looms large, despite his death just months before Mr Arnault made his move.
Mr Dumas combined creativity with business nous and a playful approach to luxury, characterised by his whimsical sketches and his mantra that Herm should but not get fat He groomed the dapper Mr Thomas, a family outsider. real reason for our objection to LVMH is cultural. We are not luxury. We are high quality, based on exceptional artisanal work, Mr Thomas says.
An anonymous modern building serves as Hermes headquarters. only influence that LVMH could have would be to jeopardise the vision that has made Herm successful for the past six generations, he says.
He brand without wanting it. Like Casanova, he must possess them all it a compulsion
The competitive and sometimes prickly Mr Arnault does not appreciate a brush off that treats him like a parvenu. The rejection, those close to him say, has made him even more determined to prevent Herm from escaping his bearhug. He has increased his stake to 22.6 per cent, despite Herm request that he desist.
was humiliating for him to be told he is not quality, says another person who knows both sides and does not wish to be named. the one Designer Louis Vuitton Replica Handbags thing Bernard can buy is other people opinion. wooing Herm Mr Arnault has praised it as a company for which he has intentions and no plan to take control. To which Mr Thomas riposted: you want to seduce a beautiful woman, you don start by raping her from behind. is already well protected from takeover through a limited partnership structure, likened by US activist investor Guy Wyser Pratte to a medieval castle that is lacking is the moat around the headquarters with a few crocodiles Mr Arnault is adept some would say ruthless in using family divisions to his advantage dolabuy.su , although the Herm family has so far remained united.
Bernard Arnault: willing to wait for Herm the leftwing French daily, called him the Machiavelli of finance because of the way he wrested control of Louis Vuitton Mo Hennessy, the handbags and spirits group, from its family shareholders in 1990.
That operation prompted Mr Dumas to put in place the soci en commandite par actions structure before floating 9 per cent of the company in 1993. Herm shares trade at multiples almost as breathtaking as the cost of its bags the company stock market value is bigger than Soci G despite revenues one eighth of those of France second biggest bank.
The takeover also led to a change in replica louis vuitton France stock market regulations not the first time that tougher rules have followed Mr Arnault manoeuvres. The regulator last year tightened the loophole on disclosure of equity swaps, which had enabled LVMH to acquire its 17 per cent Herm stake legally replica louis vuitton bags , without first having to declare thresholds of 5, 10 and 15 per cent.
Although his hardball tactics and sharp nose for profit ruffle feathers in France, they would not be out of place in the US, where Mr Arnault spent a few youthful years in Florida as a property developer. An accomplished pianist and avid art collector, Mr Arnault sees himself as a visionary with a passion for creation.
I like is the idea of transforming creativity into profitability. It what I like the most, Mr Arnault told Women fake designer bags Wear Daily.
Mr Arnault big idea in an industry traditionally dominated by small, often family owned artisanal enterprises was to acquire and consolidate such businesses into an enormously successful luxury conglomerate.
LVMH sales of last year eight times Herm were bigger than those of Michelin replica louis vuitton , the tyremaker, or Alstom, France nuclear power and transport group.