LVMH Moët Hennessy • Louis Vuitton S.A., better known as LVMH, is a French multinational
luxury goods conglomerate, headquartered in Paris. The company was formed by the 1987
merger of fashion house Louis Vuitton with Moët Hennessy, a company formed after the
1971 merger between the champagne producer Moët & Chandon and Hennessy, the cognac manufacturer.
It controls around 60 subsidiaries that each manage a small number of prestigious brands.
The subsidiaries are often managed independently. The oldest of the LVMH brands is wine producer
Château d'Yquem, which dates its origins back to 1593.
Christian Dior, the luxury goods group, is the main holding company of LVMH, owning 40.9%
of its shares, and 59.01% of its voting rights. Bernard Arnault, majority shareholder of Dior,
is Chairman of both companies and CEO of LVMH. Arnault's successful integration of various
famous aspirational brands into the group has inspired other luxury companies into doing
the same. Thus, the French conglomerate Kering and the Swiss-based Richemont have also created
extended portfolios of luxury brands.
Financial data Corporate structure
LVMH is based in 30 avenue Hoche in the 8th arrondissement, Paris, France. The company
is listed on the Euronext Paris exchange, and is a constituent of the CAC 40 index.
As of 2010, the group had revenues of €20.3 billion with a net income of just over €3 billion.
The group currently employs more than 83,000 people. 30% of LVMH's staff work in France.
LVMH operates over 2,400 stores worldwide. Its current business plan aims to tightly
control the brands it manages in order to maintain and heighten the perception of luxury
relating to their products. For example, Louis Vuitton products are sold only through Louis
Vuitton boutiques found in upmarket locations in wealthy cities or in concessions in other
luxury goods shops. Shareholders
At the end of 2010, the only declared major shareholder in LVMH was Groupe Arnault, the
family holding company of Bernard Arnault. The group's control amounted to 47.64% of
LVMH's stock and 63.66% of its voting rights. A further 2.43% of shares were declared as
treasury stock, with the remainder being free float. LVMH hold 66% of the drinks division,
Moët Hennessy, with the remaining 34% held by Diageo
Subsidiaries A partial list including some of LVMH's most
well known brands and subsidiaries:
Make Up For Ever was established in 1984 and was acquired by LVMH in 1999.
On March 7, 2011, LVMH announced the acquisition of the 50.4% family-owned shares of the Italian
jeweller Bulgari and the intention to make a tender offer for the rest. The transaction
is about $5.2 billion. On March 7, 2013, National Business Daily
reported that mid-priced clothing brand QDA will open stores with the assistance of LVMH’s
private equity LCapitalAsia and the Chinese apparel company Xin Hee Co., Ltd. in Beijing.
In 2011, LVMH invested $640 million in establishing LCapitalAsia. LVMH sales "decreased by about
10 percent from in 2011" in China and LVMH has stopped "opening stores in second and
third-tier cities in mainland China". Xue Shengwen, senior researcher at ChinaVenture,
said that the developing trend of the market is to take advantage of more acceptable prices.
In February 2014, LMVH entered into a joint venture with the Italian fashion brand Marco
De Vincenzo, taking a minority 45% stake in the firm.
Patronage LVMH is a major patron of art in France. The
group supported about ten exhibitions as "Le grand monde d’Andy Warhol" and "Picasso
et les maîtres" at le Grand Palais in Paris. LVMH also endorsed the patronage of "l’atelier
d’Alberto Giacometti" and "Yves Klein" at Centre Georges Pompidou.
In addition, LVMH foundation created the "young creators LVMH award", an international competition
opened to French and international beaux-arts students. Each year, six grants are allocated
to the winners. In November 2013, LVMH created the LVMH Young
Fashion Designer Prize, which comes with a € 300,000 grant with a year of mentoring
and is the brainchild of Delphine Arnault. The first winner will be chosen in 2014. In
February 2014, 20 finalist for the prize were shown in London, such as Simone Rocha, Thomas
Tait, Meadham Kirchhoff, Marques’ Almeida, J JS Lee, and others.
LVMH underwrites other fashion competitions, including the Andam prize in France, the International
Festival of Fashion and Photography in Hyères,France, an investment fund for young designers created
by the French Ministry of Culture and Communication, and a scholarship program and sponsored lecture
theater at Central Saint Martins in London. The group also lends Stradivarius violins
to young talented musicians. Maxim Vengerov and Laurent Korcia have used the instruments.
References
External links
Official website