PARIS — Further details emerged Monday in the settlement agreement between LVMH Moët Hennessy Louis Vuitton and Hermès regarding LVMH’s 23.2 percent stake in the luxury goods company.
This story first appeared in the November 4, 2014 issue of WWD. Subscribe Today.
As reported, the two parties in September signed an agreement that will see LVMH distribute its Hermès stake to shareholders.
LVMH specified Monday that it has agreed to give to its shareholders all of the shares it holds in Hermès on the understanding that Christian Dior, which has 40.9 percent of LVMH’s share capital through Financière Jean Goujon, will distribute the Hermès shares it receives from LVMH to its own shareholders.
The stake in question is worth an estimated 6.5 billion euros, or $8.12 billion at current exchange, and reflects a total capital gain realized by LVMH of 3.8 billion euros, or $4.75 billion, according to sources and analysts’ tallies.
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.
LVMH’s board will submit a resolution to its shareholders at a combined general meeting on Nov. 25. Should the distribution be approved, Financière Jean Goujon and Christian Dior will give the Hermès shares they receive to their respective shareholders on Dec. 17.
The French luxury rivals had traded barbs and lawsuits over four years regarding LVMH’s creeping stake in Hermès.