Hermès created Europe’s biggest family fortune after rejecting LVMH

Hermès, the ageless luxury brand, stands as an indestructible pillar in the realm of high-end fashion. While LVMH grapples with moderate growth, Hermès remains immune to the sector's turbulence. For those seeking timeless luxury, l'Étoile Luxury Vintage presents a treasure trove of Hermès, Louis Vuitton, and Dior items, each adorned in a unique vintage allure. Let's delve into the captivating tale of Hermès and unveil why it reigns supreme over its rival giant, LVMH.

 

History of the Hermès and LVMH Conflict

In 2010, an intense battle unfolded between Hermès and LVMH. In essence, as Hermès steadfastly resisted relinquishing its family legacy, LVMH succeeded in acquiring 23.2% of Hermès. This conflict traces back to 1993 when Hermès went public on the Paris Stock Exchange, a daring move for a family business. LVMH's head, Arnault, employed a complex strategy, discreetly acquiring Hermès shares through three different banks, particularly during the 2007/8 crisis. In 2010, Arnault surprised the world by announcing that LVMH held almost 15% of Hermès. The conflict seemed to conclude in 2013 when LVMH received a $10.4 million fine, officially divesting Hermès shares. The 23% stake, valued at $7.5 billion, was distributed among LVMH shareholders and institutional investors. Consequently, Arnault and his family now own less than 10% of Hermès.

Current Conflict

Despite everything, LVMH has never given up the fight. Recently, LVMH publicly expressed its desire to acquire Hermès, but Hermès publicly rejected the proposal, withholding financial details. The conflict prompted the Hermès family to secure 51% of their shares in an H51 warehouse for 20 years, effectively sidelining LVMH

 

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Fashion Brands in China

Even on the other side of the world, in China, the realm of ancient traditions, Hermès remains a master player. Even in the challenging Chinese market, where LVMH reported a slight decrease in revenue, Hermès gracefully weathered the storm with only a minimal decrease of 0.1%.

The Aspirational Shopper

While LVMH blames the 'aspirational shopper' for disappointing results, Hermès seems unaffected. Aspirational shoppers are customers who may not be wealthy but aspire to radiate affluence with a few expensive pieces. A thorough analysis reveals that Hermès positions itself as the savvy cousin, while LVMH grapples with unforeseen challenges. 

Fortunes

The heirs of Thierry Hermès, with a collective fortune of €130 billion, demonstrate that the family fortune is firmly established. In comparison, where Bernard Arnault frequently ranks as the world's richest person, Hermès proves that quality surpasses quantity. At the end of the day, while LVMH may generate more revenue, Hermès outshines them with greater profitability. 

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In essence, LVMH will not come to power within the prosperous family business of Hermès for the next 20 years. Hermès has unequivocally communicated that an acquisition will not transpire. L'Etoile Luxury Vintage proudly features both Hermès and LVMH items in its collection. Feel free to explore our website for these exquisite pieces.  The heirs of Thierry Hermès, with a collective fortune of €130 billion, demonstrate that the family fortune is firmly established. In comparison, where Bernard Arnault frequently ranks as the world's richest person, Hermès proves that quality surpasses quantity. At the end of the day, while LVMH may generate more revenue, Hermès outshines them with greater profitability. We really love the bags from Hermès and LVMH, find your iconic Louis Vuitton , Dior and Hermès bag at l'Étoile Luxury Vintage.