HERMES family shareholders won clearance yesterday to pool their stakes without having to buy out other investors, boosting the French luxury group’s defence against rival LVMH.
A majority of Hermes family shareholders decided last month to create a holding company to group more than 50 per cent of the company’s equity as a defence against LMVH, which recently lifted its stake to 20 per cent.
The holding, approved by French market watchdog AMF, is meant to discourage LVMH from attempting to acquire control of the maker of Birkin and Kelly handbags.
But the holding’s creation needed the AMF’s exemption from having to make a tender offer for other minority shareholdings, which would have been costly.
“It was already a fortress, this decision means that the walls have been heightened,” said a source.
Hermes shares closed down 1.9 per cent at €155.05 (£96.7), valuing the group at €16.33bn.
But not all the around 70 family shareholders, descendents of the Puech, Dumas and Guerrand families who in total control around 73 per cent of Hermes’s share capital, are part of the holding.
The AMF said it would publish an explanation of its decision soon.
Hermes family shareholders said in a statement: “This decision clears the way for our project to reclassify (our shares) which underscores the family’s unanimous will to preserve Hermes’s culture.”
The minority shareholders’ association ADAM said it would very likely appeal against the decision.
LVMH declined to comment.
City A.M. Reporter