PARIS — Shares in Hermès International galloped ahead 6.5 percent in morning trading on the Paris Bourse as LVMH Moët Hennessy Louis Vuitton distributed its 23.2 percent stake in its luxury rival to shareholders.
The transaction also sent shares in LVMH down 7.4 percent, but bumped up shares in Christian Dior SA, the holding company for LVMH and the Dior fashion house, by 2.4 percent.
Shares in Hermès opened at 280.10 euros, meaning the exceptional distribution in kind came to 13.66 euros per LVMH share.
LVMH said its consolidated financial statements would register an exceptional capital gain of 2.81 billion euros, excluding tax, or $3.51 billion at current exchange rates.
As reported, the two parties in September signed a truce agreement, ending a four-year exchange of barbs and lawsuits over LVMH’s creeping stake in the maker of Birkin bags and silk scarves.
LVMH, Dior and Groupe Arnault — companies controlled by Bernard Arnault — also agreed not to acquire any shares in Hermès for the next five years, leaving the door open to potential synergies between the two companies in the future.
In a research note, Barclays reiterated its overweight rating on LVMH.
The complex transaction leave Group Arnault holding an 8.5 percent stake in Hermès and increasing the free float in the latter firm.