PARIS — Hermès International has come out swinging against the French Association for Minority Shareholders, or ADAM, accusing it of “aggression” in its ongoing quest to blunt the will of the controlling family.
This story first appeared in the May 20, 2011 issue of WWD. Subscribe Today.
Hermès was informed this week that ADAM filed a request with the Commercial Court here asking it to waive the family’s voting rights at the firm’s annual shareholders meeting here May 30. The court is slated to referee the request on May 24.
As reported, ADAM is also seeking to block Hermès family members from grouping more than 50 percent of their shares into a nonlisted holding company, a defensive move against a potential takeover bid by LVMH Moët Hennessy Louis Vuitton, which has amassed a 20.2 stake in Hermès.
In a statement Thursday, Hermès called the new request “groundless” and accused ADAM of attempting to pass control to LVMH only a few days after Hermès reported what it described as “the best results in the sector.”
Sales at Hermès jumped 25.5 percent in the first quarter to 637.1 million euros, or $870.8 million.
The company’s statement came on the same day ADAM argued its appeal here of a decision by the French stock market authority AMF in January to grant Hermès an exemption from buying out minority shareholders. A decision is expected in the fall.
ADAM president Colette Neuville — the owner of a single Hermès share — could not be reached for comment Thursday.
The AMF is separately examining whether LVMH violated market rules by buying its shares via equity derivatives.
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 the shares in Hermès International, a limited partnership structure that guarantees they keep control of management.
Still, they want to reinforce that by grouping their capital. 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. Hermès had asked the AMF for an exemption on the grounds that the family effectively controls the company already.