Bernard Arnault confirmed he bought a small stake in Cartier owner Richemont, as the chief executive officer of rival luxury conglomerate LVMH seeks to cool speculation about his intentions.
“I know well the owner, Mr Johann Rupert, of Richemont,” Arnault said in an interview on CNBC broadcast Friday. “And we have a good relationship and I told him that I will never do anything against him. That’s clear.”
It’s “a very minor stake,” Arnault said, confirming a report last month by Bloomberg Businessweek that he had invested as part of a broader family-owned portfolio of investments in publicly-listed companies.
News of the shareholding triggered questions around his intentions for the investment. Richemont has a strong defense against unwanted suitors because Rupert, its chairman, controls 51 percent of the voting rights despite owning only 10.2 percent of the capital. Over the past few years, 74-year-old Rupert has emphasised his desire to keep the group independent.
“He’s done something fantastic with Richemont, with Cartier, with Van Cleef and I think he’s independent, he wants to stay independent and I agree completely on that,” Arnault said.
LVMH owns jewellery brands including Tiffany & Co. as well as Bulgari, meaning a takeover of Richemont would likely attract antitrust scrutiny. LVMH’s fashion brands Louis Vuitton and Christian Dior Couture have jewellery lines, too.
Earlier this week, LVMH Moët Hennessy Louis Vuitton SE posted second-quarter results that missed estimates amid a demand slowdown for high-end goods, particularly in the key Chinese market. Arnault is the world’s third wealthiest individual, with a fortune estimated at around $185 billion, according to the Bloomberg Billionaires Index.
By Angelina Rascouet
Learn more:
Op-Ed | Could LVMH Buy Richemont?
Acquiring Richemont would catapult LVMH into a completely different stratosphere to the rest of the luxury industry, writes Andrea Felsted.
Disclosure: LVMH is part of a group of investors who, together, hold a minority interest in The Business of Fashion. All investors have signed shareholders’ documentation guaranteeing BoF’s complete editorial independence.
