LVMH IN DEAL WITH DE RIGO
Byline: Courtney Colavita
MILAN — In a move to conquer more of the luxury market, Italian eyewear manufacturer De Rigo has announced a strategic alliance with LVMH Moet Hennessy Louis Vuitton to develop and distribute eyewear for the French fashion group.
A statement from De Rigo said the agreement would also give LVMH the chance to acquire up to 5 percent of De Rigo’s equity from controlling family members by the end of this year. The De Rigo family has a 77 percent stake in the company; the remaining shares are traded on the New York Stock Exchange.
“This is another step for us to increase our luxury brand portfolio,” said Maurizio Dessolis, chief financial officer for De Rigo. “Our strategy over the past two years has been to move away from mass market products and focus on building premium brands.”
An LVMH spokeswoman confirmed the agreement, but would not elaborate.
As reported in these columns, LVMH was said to have already bought the De Rigo shares for a total of $16.7 million in December. But Dessolis said De Rigo and LVMH signed the deal this week and that LVMH had yet to exercise its option to buy.
Dessolis said the cost of the 5 percent stake in De Rigo would be based on the market price of the shares and on the number of licenses granted by LVMH.
De Rigo already manufactures eyewear under license for Givenchy, Celine and Loewe, and Dessolis said it would like to add more LVMH brands — specifically Christian Dior — to its stable.
“Clearly we are strongly interested in the Dior license, but that is another deal entirely, and something we will have to wait for,” he said.
Dior’s current eyewear contract is with Italy’s Safilo, and is set to expire in 2002. Both Safilo and LVMH declined to comment on the future of that license.
The LVMH agreement is De Rigo’s second alliance with a luxury goods group.
In March 1999, De Rigo formed a joint venture with Prada to manufacture, market and distribute eyewear for Prada and Prada Group brands Miu Miu and Helmut Lang.
De Rigo also makes Sting, Fila and Police eyewear. In 2000, De Rigo reported sales of $403.8 million, up 42 percent from 1999.