Hermes complain against LVMH over stake building
Hermes said Tuesday that it has filed a legal complaint over the manner in which luxury giant and rival LVMH bought a stake in the company in 2010.
“This complaint relates to the terms in which LVMH became a stakeholder in Hermes International,” Hermes said.
A judicial source said the complaint was for insider trading, collusion and price manipulation. It is still being studied by Paris prosecutors, the source said.
In a surprise move that riled members of the Hermes family, LVMH bought a 17-percent stake in the leather bag and silk scarf maker in 2010. That holding reached 22.28 percent by the end of May.
LVMH, which is controlled by billionaire businessman Bernard Arnault, said it is filing a countersuit.
The world’s leading luxury group said that its entry into Hermes’ capital was “perfectly legal” and that the accusations by Hermes are “completely without basis.”
Given that France’s AMF stock market regulator has not concluded its probe, LVMH said that Hermes’s actions were improper.
“Under these conditions, LVMH is obliged to file a countersuit for blackmail, false accusation and illegal competition,” it said in a statement.
Hermes family members changed the structure of the company into a holding, allowing them to fend off a hostile takeover from LVMH, and received court approval to do so without making a buyout offer to minority shareholders.