LVMH to Bag Christian Dior Couture for 6.5 bn Euros
The world's top luxury company LVMH said Tuesday it plans to buy Christian Dior Couture, a wholly-owned unit of Christian Dior SA, for 6.5 billion euros ($7.0 billion).
At the same time, the Arnault family who own 74 percent of the parent company, Christian Dior SA, will acquire the remaining 26 percent in a move to streamline the current shareholder structure, LVMH finance chief Jean-Jacques Guiony told a telephone news conference.
Set up 70 years ago, Christian Dior Couture "is one the most iconic brands worldwide", LVMH said.
Its activities range from leatherware, Haute Couture, read-to-wear, jewellery and shoes and has a global network of 198 luxury boutiques and its sales have doubled over the past five years.
Last year, revenues amounted to more than two billion euros and it booked underlying or operating profit of 270 million euros.
Under the current group structure, Christian Dior Couture is wholly owned by Christian Dior SA, which for its part also holds a 41-percent stake in LVMH.
By making it a wholly-owned subsidiary, LVMH would be able to harness its "high growth potential" of Christian Dior Couture, the statement said.
At the same time, the Arnault Family Group is planning a public takeover offer to purchase the shares in Christian Dior SA it does not already own.
The bid will take the form of a cash offer of 172 euros per share, plus 0.192 shares in Hermes International, the statement said.
The simplification of the shareholder structure appeared to please investors and LVMH shares were showing a gain of around three percent on the Paris stock exchange in response to the news, while the blue-chip CAC 40 index was up just 0.1 percent.
Source: Agence France Presse
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