Louis Vuitton Moet Hennessy, the French luxury conglomerate, said today that it would take control of Italy’s Bulgari in an all-share deal worth 3.7 billion Euros.
Bulgari’s controlling family has agreed to exchange its 51 percent stake in the jeweler for 16.5 million LVMH shares, making it the second-largest family shareholder in the group. The family will also gain two seats on LVMH’s board, the company said.
“We found in Bernard Arnault and the group he has built all the elements that are required to guarantee the long-term future of Bulgari,” Paulo and Nicola Bulgari, chairman and vice chairman of the jeweler, said in a joint statement, referring to the head of LVMH.
Bulgari’s chief executive, Francesco Trapani, whom Mr. Arnault called “the driving force behind Bulgari’s development over the last twenty years,” will join LVMH’s executive committee, as well as lead the company’s expanded watches and jewelry business.
“As is the case with LVMH, the Bulgari family shareholders are directly involved in managing the company,” Mr. Arnault said, “they are entrepreneurs that know and excel in all aspects of the business.”
Official Press Release
The Bulgari family joins forces with LVMH and transfers its majority shareholding in Bulgari S.p.A.
The Bulgari Family, majority shareholder of the renowned Italian House established in 1884 by Sotirio Bulgari, has decided to join forces with the LVMH Group in order to reinforce, in accordance with its history, values, craftsmanship and identity, the long term development of the Bulgari Group. A synonym of creativity and excellence the world over, Bulgari is renowned as one of the major players in its sector and occupies a strong leadership position in the jewelry and watch segment, while playing an important role in the fragrance, cosmetic and accessories segments as well.
The agreement was concluded this weekend and was approved unanimously by the LVMH Board of Directors Sunday evening. The Board of Directors of Bulgari S.p.A. has also unanimously approved the project of contributing to LVMH the Family’s majority shareholding in Bulgari S.p.A. Upon completion of the share transfer process, LVMH will issue 16.5 million shares in exchange for the 152.5 million Bulgari shares currently held by the Bulgari Family, who will thus become the second largest family shareholder of the LVMH Group. In compliance with the Italian Stock Exchange regulations, LVMH will submit a Public Purchase Offer at the price of €12.25 per share on the shares held by minority stockholders, further details of which are described in the press releases issued today.
Paolo and Nicola Bulgari will remain Chairman and Vice Chairman of the Bulgari S.p.A. Board of Directors, respectively. The Bulgari Family will furthermore be entitled to appoint two representatives to the LVMH Board of Directors and Francesco Trapani, CEO of Bulgari S.p.A., will join the Executive Committee of LVMH and will assume in the second half of 2011 the management of the LVMH enlarged Watches and Jewelry activities. Philippe Pascal, the current Head of these activities, will remain on the LVMH Executive Committee and will be given new responsibilities within the Group.
