PARIS — The families that control Hermès have rolled out a new unwelcome mat in the face of its surprise suitor, LVMH Moët Hennessy Louis Vuitton.

This story first appeared in the December 6, 2010 issue of WWD. Subscribe Today.

Following a meeting of members of the Dumas, Puech and Guerrand branches on Friday, the family said late Sunday it had formed a nonlisted holding company amassing “more than 50 percent” of the capital of Hermès International.

The move is designed to protect it from a potential takeover by LVMH, which in October revealed it had built a 17.1 percent stake in the maker of Birkin bags and silk scarves via cash-settled equity swaps. Although the French luxury conglomerate, parent of Sephora, Dom Perignon, Fendi and some 60 other brands, described its investment as long term, Hermès has characterized its surprise investor as an “intruder” in its garden.

In its statement, the family said it “reaffirmed its unity and its confidence in the solidity of its control of Hermès International” by creating the holding. “The will of the family to create this majority holding is irrevocable,” the statement said.

The name of the new entity and the exact number of shares it holds were not disclosed.

Hermès officials have said the three family branches collectively own 73.4 percent of capital, with the shares spread between dozens of heirs to Thierry Hermès, who founded the company in 1837.

Hermès faces opposition from France’s minority shareholders’ association, which argues that it should be obliged to launch a public offer should the family group its shares into bloc. Regulations require that any entity that gains control of more than a third of shares launch an offer.

In its statement Sunday, Hermès said its independence is assured by the company’s “limited partnership” structure, which posits decision-making authority in the hands of family members, and now its “capitalist holding.”

“This internal reclassification will have no impact on the family’s involvement in the capital of Hermès International, nor on the powers of its limited partnership,” the statement said, adding that it would await approval from the French market authority, or AMF.

The AMF has already launched a probe of LVMH’s investment to determine if rules were respected, which LVMH said it welcomes. In France, companies are required to declare stock purchases when they exceed 5 percent of the share capital.

A war of words has erupted between LVMH and Hermès, pitting a formidable corporate raider and luxury powerhouse against a family controlled firm that sees its corporate culture and brand ethos as unique.

The prospect of Friday’s family meeting goosed shares in Hermès, which rallied 12 percent last week.

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