PARIS – The board of France’s stock market regulator will meet on Thursday to examine a request by Hermès to be exempted from buying out minority shareholders in its attempt to fend off a potential takeover bid by LVMH Moët Hennessy Louis Vuitton, according to market sources.
The 16-member committee of the AMF, headed by its president Jean-Pierre Jouyet, will debate the issue but will not necessarily publish a ruling on the same day, the sources said. Officials at the AMF declined comment.
LVMH revealed last month that it has boosted its stake in Hermès to 20.2 percent after its initial shock acquisition of a 17.1 percent share of capital through cash-settled equity swaps. The AMF is separately examining whether LVMH violated market rules.
Though LVMH chairman and chief executive officer Bernard Arnault has said he is not seeking full control of the maker of Birkin handbags and silk scarves, Hermès has vowed to protect itself from what it considers an unwelcome suitor.
The Dumas, Puech and Guerrand families collectively own more than 70 percent of shares in Hermès International, a limited partnership structure that guarantees they keep control of management. Still, they want to reinforce that by grouping more than 50 percent of the capital into a nonlisted holding company.
This would normally oblige the luxury firm to launch an offer for the remaining shares, since it would be crossing the threshold of one-third of capital or voting rights, but Hermès has asked the AMF for an exemption on the grounds that the family effectively controls the company already.
Colette Neuville, president of the French Association for Minority Shareholders (ADAM), vowed to file an appeal if the AMF granted Hermès an exemption, arguing that this would unfairly penalize holders of the less than 10 percent of the company’s capital that is freely traded.