FRANCE. Bernard Arnault, Chairman and CEO of LVMH Moët Hennessy Louis Vuitton, is to acquire around 25% of Lagardère Capital & Management (LC&M), the holding company of Arnaud Lagardère.
Arnaud Lagardère is Managing Partner of Lagardère Group, parent of Lagardère Travel Retail, and through his holding company owns 7.26% of shares in the French publishing to travel retail group. LVMH Moët Hennessy Louis Vuitton controls 61.25% of leading travel retailer DFS Group, the other 38.75% still retained by co-founder Robert (Bob) Miller.
A joint statement from Lagardère Capital & Management and Groupe Arnault (Bernard Arnault’s investment vehicle) said: “This merger will strengthen the structure and financial capabilities of LC&M. The family groups of Bernard Arnault and Arnaud Lagardère will act in concert with respect to Lagardère SCA.”
Arnault said: “I welcome Arnaud Lagardère’s proposal to join forces with him. My friendship with Jean-Luc Lagardère (Arnaud’s father) has bound our families together and I have the utmost respect for the group he has built.”
The move comes against the backdrop of a recent attempt by leading Lagardère Group shareholder Amber Capital to replace the Supervisory Board. Shareholders rejected the Amber Capital proposal at the General Meeting of the group on 5 May.
In late April, Arnaud Lagardère issued a strong statement to shareholders about the matter, saying the 5 May meeting was “unprecedented in the history of the Lagardère Group. On this occasion, you are being asked to choose between the implementation of a responsible, clear and ambitious strategy led by the Managing Partners and Supervisory Board, and Amber Capital’s radical, unsettling and uncertain proposal.”
He added: “The timing of this attack is also inappropriate, when the Group should be concentrating all its efforts on limiting the impact of this crisis in the interest of all its stakeholders. Amber Capital is proposing a clean sweep of the existing Supervisory Board and to appoint members with not particular in-depth knowledge or experience of the Group’s businesses, whose selection process has not been transparent and whose independence from Amber Capital is far from assured.
“This proposal is also irresponsible as it would end in institutional deadlock, especially in these exceptional circumstances where long-term thinking, intimate understanding of the Group’s challenges and smooth functioning of the governance bodies are more critical than ever. On this basis, the Supervisory Board has unanimously recommended rejecting the resolutions proposed by Amber Capital.”
The Lagardère Group share price leapt by +16.15% to €13.02 on the Paris stock exchange today as news of the Groupe Arnault-Lagardère Capital & Management alliance emerged.
