Hermes Group Accuses LVMH Of Holding Its Shares In The Transaction (Figure)

Hermes, the French luxury goods manufacturer, issued a press release on the 4th, confirming that it had submitted a complaint to the Paris Procuratorate in July this year, accusing another French luxury goods manufacturer Louis Vuitton (LVMH) Group holds Hermes shares through unconventional means such as "insider trading" and "collusion inside and outside".

Hermes Petition LVMH Group's Insider Trading Holdings

Hermes confirmed in the bulletin that it filed a lawsuit with the Paris Procuratorate on July 10 this year, requesting a judicial investigation into the operation of Louis Vuitton (LVMH) to increase its shareholding in Hermes. Louis Vuitton also issued a statement on the same day, saying that the operation of the group's stake in Hermes was in line with the norms. The group also filed a counterclaim, accusing Hermes of "extortion, false accusations and unfair competition".

According to French media reports, the local weekly quoted a person familiar with the judicial institution as saying that Hermes believed that LVMH had "insider trading", "collusion inside and outside" and "manipulation of stock prices" and other improper behaviors in the operation of increasing its stake in Hermes, and the Paris Procuratorate was "studying" the complaint of Hermes.

On October 23, 2010, Louis Vuitton unexpectedly announced that it had purchased 17.1% of Hermes shares, and increased its shareholding in Hermes to 22.28% at the end of December last year, becoming the largest single shareholder other than the heirs of the Hermes family.

LVMH said that it will focus on "long-term strategic investment" and increase its stake in Hermes according to the actual situation and market changes, but it will not seek to control the brand nor launch a public takeover bid for it. However, Hermes does not want Louis Vuitton to take a stake in the Group, and believes that Louis Vuitton has not issued a notice in accordance with relevant regulations when the increased shares exceed the limit of available voting rights, requiring the French financial market regulator to investigate its shareholding operations.

The heirs of Hermes family hold 73.4% of the shares of the group, but no single heir holds more than 5% of the shares. In December last year, the heirs of the Hermes family announced the establishment of a holding company, concentrating about 50.2% of their shares together and freezing them for 20 years, while enjoying the preemptive right to purchase the other 12.3% of their shares. This is intended to counter the possible further acquisition of Louis Vuitton.

LVMH is the world's largest luxury goods group, with more than 50 internationally renowned brands Luxury brand 。 Hermes is a manufacturer of leather goods and Silk scarf A well-known luxury goods manufacturer. 20% of Hermes' shares were publicly listed in 1993, and the rest were held by family heirs and a few senior executives of the company.

According to the French financial market transaction regulations, a shareholder shall notify the held enterprises and financial market regulators when its increased shares exceed 5%, 10%, 15%, 20%, 25%, 33.33%, 50%, 66.66%, 90% and 95%.