Bernard Arnault prepares his succession by perpetuating family control of the world leader in luxury LVMH with the reorganization of the Agache holding company into a limited company. “The LVMH group is a family group,” recalls Bernard Arnault, quoted in a press release published Thursday by Agache. The transformation into a limited company “which does not modify its current shareholding, ensures the long-term sustainability of its control over the LVMH group”, according to him.
This new structure should allow the long-term sustainability of the majority shareholder’s family control within Christian Dior and LVMH. The control of the Agache company will be exercised by Agache Commandité SAS, an entity whose capital will be in equal parts by the five children of Bernard Arnault, the holding company specifies in its press release.
The five children of the businessman already work in the LVMH group. Delphine Arnault, 47, is deputy general manager of Louis Vuitton and Antoine Arnault, 45, is head of image and communication at LVMH and general manager of Berluti. Alexandre, 30, Executive Vice President of Tiffany, Frédéric, 27, CEO of Tag Heuer and Jean, 24, Director of Marketing and Watch Development at Louis Vuitton.
Facilitate transmission
Agache will remain the exclusive property of the Arnault family group, now as sponsor. Bernard Arnault will be the first and only general partner of Agache, that is, he will be the pilot of the limited company. “From then on”, the general partner will be Agache Commandité SAS, whose capital will be owned equally by the five heirs.
Sponsorship is recognized for its characteristics that facilitate transmission within a family business. It makes it possible to disassociate management and ownership from capital and is also a dissuasive weapon against hostile takeover bids. Long used by Lagardère, it is present in some very rare companies, such as the tire manufacturer Michelin, the luxury brand Hermès or even Sofibol, the parent company of the Bolloré group. With this operation, Bernard Arnault does not designate his successor and does not intend to hand him over in the near future.
The age limit for the CEO of LVMH is lowered to 80 years
At the annual general meeting, the age limit for LVMH’s chief executive was pushed back from 75 to 80, allowing its 73-year-old CEO to extend his term. It was not proposed to change the age limit of the president, which, according to the statutes, is 75 years. The Bernard Arnault family group held in April at the general meeting 47.83% of the capital of LVMH and 63.89% of the voting rights.
In 2021, LVMH recorded €64.2 billion in sales and a net profit of €12 billion. The luxury number one’s 2022 half-year results are expected on Tuesday after a buoyant first quarter of 2021 that had recorded €18bn in sales, a jump of 29% compared to the same period a year earlier.
Source: BFM TV
