Bernard Arnault, the head of LVMH was recently declared to be world’s most powerful man in the field of luxury. The thin and wiry man has created a stir in the Hermes family, as he bought a 17% stake last month. The Hermes group has termed this not only unfriendly but also have implored him to withdraw.
They however insist that Bernard Arnault can never take over Hermes, as they have strict anti hostile-takeover byelaws. Also, they would not change the way they make business no matter what. It is also not clear if the LVMH’s stake happened legally and thus the group will wait for the French market regulator’s decision. Hermes family owns about 73% of the share capital.
Puech, a fifth-generation descendant of founder Thierry Hermes revealed that Mr. Arnault has been directly told to withdraw from the stake he bought last month, for it not only is unfriendly but also unacceptable that a rival company could do it without a hitch. They expressed their concern that it was not a financial battle but a cultural battle as Hermes and LVMH has a very divided consumer base.