The takeover of the French luxury group LVMH will strengthen its fashion group and simplify structures. How the deal with Dior will look and why it is a milestone for the Group.
The French luxury group Moët Hennessy Louis Vuitton (LVMH) announced on Tuesday that the fashion house Christian Dior Couture under the creative direction of Maria Grazia Chiuri completely want to take over. If the project succeeds, the Group will integrate the luxury label into its fashion and leather goods division – which also includes other 100 percent subsidiaries, such as Fendi and Rimowa, as well as LVMH-owned luxury labels.
The LVMH Group is the global leader in the luxury goods industry and sometimes holds rights to more than 60 different brands, including Kenzo, Givenchy, Céline and Kenzo, Givenchy, and up to now 74.3 percent of the luxury label Dior.
Consolidation with Dior
For the remaining around 25.7 percent, which are not yet in their possession, LVMH CEO Bernard Arnault has now submitted an offer for the shares of the holding company Christian Dior SE. „This project is an important milestone for the group,“ explains Arnault. In addition, the LVMH CEO adds that the takeover of the group would be strengthened by „one of the most iconic brands in the world“.
It is to be paid € 260 per share – a total of € 12.1 billion. At the same time, the Paris fashion company, which up to now owns 100% of the holding company Christian Dior SE, is to be located completely at LVMH. The company value of Christian Dior Couture is valued at EUR 6.5 billion in this transaction.
The offer for the shareholders of Christian Dior SE is about 14.7 percent above the stock market closing price of the stock on Monday. The shareholders can choose whether to get the 260 euros per share paid in cash or in the form of Hermès shares – as stated in the published company report. The transaction is expected to be completed in the second half of 2017.