Bernard Arnault and How He Led LVMH to Become a Luxury Conglomerate

Moët Hennessy Louis Vuitton SE (OTC: LVMUY), commonly referred to as LVMH or Louis Vuitton is a French luxury conglomerate that was formed in 1987 following the merger of the renowned fashion house Louis Vuitton and the wines and spirits company Moët Hennessy. 

Today, LVMH owns 75 brands in six business groups: wines and spirits, perfumes and cosmetics, fashion and leather goods, watches and jewellery, selective retailing, and other activities. The business group also owns big brands such as Givenchy, Fendi, TAG Heuer, and many others.

The company has been led by Bernard Arnault, who has been the Chairman and CEO of Louis Vuitton since 1989. He took the largest stake in the company and has led LVMH to greater heights, as they have acquired a lot in the past three decades. 

The company has continued to acquire different luxury brands in different sectors. In 2022, the firm announced a net profit of €4.7 billion on revenue of €44.7 billion ($53.0 billion). On July 7, 2021, LVMH's market capitalization was $390.9 billion.

We would like to take an overview of some of the acquisitions that LVMH has made since its inception.

Tiffany & Co.

This company was founded in 1837 by Charles Lewis Tiffany and has since grown to be one of the leading global design houses for innovative jewellery design and expert craftsmanship. The firm deals with bracelets, earrings, necklaces, watches, and rings, as well as different home accessories and fragrances.

LVMH announced that they were on the move to acquire Tiffany in 2019 for approximately $16.2 billion, but this move changed as Arnault had to renegotiate the acquisition due to the effects of the coronavirus pandemic that started in December 2019. He asked for an 11% reduction in the deal, which was met, followed by a lawsuit from Tiffany, who intends to ensure the implementation of the initial acquisition agreement. In the end, the two companies concluded on a purchase price of $131.50 per share, which was a 2.6% discount from the previously agreed-upon $135 per share, bringing the total purchase price to $15.8 billion.

Fendi

This firm was founded by Adele and Edoardo Fendi in 1925. The company deals with leather goods, fur, and luxury products. LVMH acquired a stake in Fendi before it became the majority stakeholder in 2001. LVMH ownership came in after the firm and Prada bought a 25.5% stake in Fendi in 2000. Then, LVMH became the biggest stakeholder in November 2001 when it agreed to buy Prada’s stake. LVMH’s Fashion and Leather Goods group, of which Fendi is a part, generated €7.2 billion in profit on €21.2 billion in revenue in 2020.

Bulgari

Known for creativity and colourful jewellery designs, Bulgari has been at the forefront of luxury goods since its founding in 1884 by Sotirio Bulgari. the deal, which LVMH announced in March.

The company was founded in 1884 by Sotirio Bulgari and has since focused on colourful jewellery designs. LVMH announced in March 2011 that it was going to go into a deal to expand the company’s watch and jewellery business group. 

The acquisition included the purchase of a 50.4% stake in Bulgari from the Bulgari family, as well as a tender offer for the remainder of the company. Watches & Jewellery remains one of the smaller LVMH groups when it comes to profit. In 2020, this group delivered €0.3 billion in profit on €3.4 billion in revenue, the report shows.

Sephora

The company was founded in 1969 and has since been a retailer of personal care and beauty items, with over 15,000 different products on offer. When LVMH acquired the firm, Sephora was part of a brand owned by Dominique Mandonnaud. 

Frequently Asked Questions (FAQs)

Who Owns Louis Vuitton?

Bernard Jean Étienne Arnault, born March 5, 1949, is a French businessperson, investor, and art collector. He is the founder, chairman, and CEO of LVMH Moët Hennessy Louis Vuitton, the world's largest luxury goods company

What Is LVMH?

Moët Hennessy Louis Vuitton, also known as LVMH or Louis Vuitton, is a French luxury conglomerate formed from the 1987 merger of the renowned fashion house Louis Vuitton and the wines and spirits company Moët Hennessy.

Who Is Bernard Arnault?

Bernard Jean Étienne Arnault is a French businessperson, investor, and art collector. He is the founder, chairman, and CEO of LVMH Moët Hennessy Louis

Who Owns Sephora?

Sephora is owned by LVMH Moët Hennessy Louis Vuitton