LVMH Buys Luxury Yachts Brand Feadship

Yacht firm Royal van Lent now under LVMH umbrella.

PARIS — LVMH Moët Hennessy Louis Vuitton is sailing into new luxury waters and buying a famous Dutch maker of custom megayachts priced at $30 million and up.

This story first appeared in the September 2, 2008 issue of WWD.  Subscribe Today.

The French luxury giant said late Monday it signed an exclusive agreement to acquire Royal van Lent from Egeria, an investment firm based in the Netherlands.

A designer and builder of yachts more than 160 feet in length and sold under the Feadship brand, Royal van Lent has seen worldwide orders for the category grow more than 20 percent annually since 2000, according to LVMH.

Market sources estimate Royal generates annual revenues at north of 100 million euros, or $146 million at current exchange rates, and its production output at about five ships per year.

Financial terms were not disclosed, however an LVMH spokesman pegged the purchase price at 11 times net results — a reasonable multiple for the luxury sector.

In a statement, LVMH touted an “outstanding growth opportunity that is resistant to economic cycles” and a chance for the group to expand its reach beyond its core business groups: fashion and leather goods; perfumes and cosmetics; watches and jewelry; wines and spirits, and specialty retail.

LVMH said it would leverage its high-end client network and global reach to accelerate the growth of Royal van Lent “while maintaining its unique heritage, exclusive positioning and exceptional craftsmanship.”

Dick van Lent, chief executive officer of Royal van Lent, is to remain at the 160-year-old company. Feadship can boast that 40 percent of its clients are return customers as a game of one-upmanship plays out in the world’s most glamorous ports of call.

Monday’s news suggests LVMH kingpin Bernard Arnault, himself the owner of a monster yacht, is once again in a mood to spend — although still not for fashion.

Last April, LVMH acquired 100 percent of fast-growing Swiss watchmaker Hublot.

France’s second richest man has also been active on various business fronts through separate investment vehicles.

Last June, L Capital 2 FCPR, an investment group sponsored by LVMH and Groupe Arnault, said it acquired more than 70 percent of Princess Yachts International plc from South African entrepreneur Graham Beck.

The same month, Financière Agache Private Equity, part of Groupe Arnault, took a 37 percent stake in Groupe Paprec, France’s leading recycler of plastics and office paper.