LVMH
Encyclopedia
LVMH Moët Hennessy • Louis Vuitton S.A., better known as LVMH, is a French
multinational
luxury good
s conglomerate
headquartered
in Paris
, Île-de-France
, France
. The company was formed after the 1987 merger of fashion house
Louis Vuitton
with Moët Hennessy, a company formed after the 1971 merger between
the champagne producer Moët & Chandon and Hennessy
, the cognac manufacturer
. It controls around 60 subsidiaries
that each manage a small number of prestigious brands. The subsidiaries are often managed independently.
Christian Dior
, the luxury goods group, is the main holding company of LVMH, owning 42.36% of its shares, and 59.01% of its voting rights. Bernard Arnault
, majority shareholder of Dior, is Chairman of both companies and CEO of LVMH. His successful integration of various famous aspirational brand
s into the group has inspired other luxury companies into doing the same. Thus Gucci
(now part of the French conglomerate PPR
) and Richemont
have also created extended portfolios of luxury
brands. The oldest of the LVMH brands is wine producer Château d'Yquem
, which dates its origins back to 1593.
in 30 avenue Hoche in the 8th arrondissement Paris
, Île-de-France
, France
. The company is listed on the Euronext Paris
exchange, and is a constituent of the CAC 40
index. As of 2010, the group had revenues of €20.3 billion with a net income of just over €3 billion. The group currently employs more than 83,000 people. 30% of LVMH's staff work in France. LVMH operates over 2,400 stores worldwide. Its current business plan aims to tightly control the brands it manages in order to maintain and heighten the perception of luxury relating to their products. For example, Louis Vuitton products are sold only through Louis Vuitton boutiques found in upmarket locations in wealthy cities or in concessions in other luxury goods shops (such as Harrods
in London). This practice contrasts greatly with less exclusive brands which can be bought in shopping malls around the world.
of Bernard Arnault
. The group's control amounted to 47.64% of LVMH's stock (with 42.36% held through Christian Dior S.A. and 5.28% held directly) and 63.66% of its voting rights (59.01% by Dior and 4.65% directly). A further 2.43% of shares were declared as treasury stock
, with the remainder being free float. LVMH hold 66% of the drinks division, Moét Hennessy, with the remaining 34% held by Diageo
.
On 7 March 2011, LVMH announced the acquisition of the 50.4% family-owned shares of the Italian jeweller Bulgari
and the intention to make a tender offer for the rest (publicly owned). The transaction is about $5.2 billion.
France
The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...
multinational
Multinational corporation
A multi national corporation or enterprise , is a corporation or an enterprise that manages production or delivers services in more than one country. It can also be referred to as an international corporation...
luxury good
Luxury good
Luxury goods are products and services that are not considered essential and associated with affluence.The concept of luxury has been present in various forms since the beginning of civilization. Its role was just as important in ancient western and eastern empires as it is in modern societies...
s conglomerate
Conglomerate (company)
A conglomerate is a combination of two or more corporations engaged in entirely different businesses that fall under one corporate structure , usually involving a parent company and several subsidiaries. Often, a conglomerate is a multi-industry company...
headquartered
Corporate headquarters
Corporate headquarters is a term used to describe the entity at the top of a corporation to take full responsibility for the overall success of the corporation, ensures Corporate Governance...
in Paris
Paris
Paris is the capital and largest city in France, situated on the river Seine, in northern France, at the heart of the Île-de-France region...
, Île-de-France
Île-de-France (région)
Île-de-France is the wealthiest and most populated of the twenty-two administrative regions of France, composed mostly of the Paris metropolitan area....
, France
France
The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...
. The company was formed after the 1987 merger of fashion house
Fashion House
Fashion House is an American telenovela that aired at 9 p.m. ET/8 p.m. CT Monday through Saturday on MyNetworkTV stations. The series premiered on September 5, 2006 and concluded on December 5, 2006...
Louis Vuitton
Louis Vuitton
Louis Vuitton Malletier – commonly referred to as Louis Vuitton , or shortened to LV – is a French fashion house founded in 1854 by Louis Vuitton. The label is well known for its LV monogram, which is featured on most products, ranging from luxury trunks and leather goods to ready-to-wear, shoes,...
with Moët Hennessy, a company formed after the 1971 merger between
Mergers and acquisitions
Mergers and acquisitions refers to the aspect of corporate strategy, corporate finance and management dealing with the buying, selling, dividing and combining of different companies and similar entities that can help an enterprise grow rapidly in its sector or location of origin, or a new field or...
the champagne producer Moët & Chandon and Hennessy
Hennessy
Jas Hennessy & Co., or more simply Hennessy, is a world-leading cognac house with headquarters in Cognac, France. Today, the company of Jas Hennessy & Co...
, the cognac manufacturer
Manufacturing
Manufacturing is the use of machines, tools and labor to produce goods for use or sale. The term may refer to a range of human activity, from handicraft to high tech, but is most commonly applied to industrial production, in which raw materials are transformed into finished goods on a large scale...
. It controls around 60 subsidiaries
Subsidiary
A subsidiary company, subsidiary, or daughter company is a company that is completely or partly owned and wholly controlled by another company that owns more than half of the subsidiary's stock. The subsidiary can be a company, corporation, or limited liability company. In some cases it is a...
that each manage a small number of prestigious brands. The subsidiaries are often managed independently.
Christian Dior
Christian Dior SA
Christian Dior S.A. is a French company which owns the high-fashion clothing producer and retailer Christian Dior Couture, as well as holding 42% of LVMH Moët Hennessy • Louis Vuitton, the world's largest luxury goods firm. Both Dior and LVMH are controlled and chaired by businessman Bernard...
, the luxury goods group, is the main holding company of LVMH, owning 42.36% of its shares, and 59.01% of its voting rights. Bernard Arnault
Bernard Arnault
Bernard Arnault is a French business magnate who is best known as the chairman and CEO of the French conglomerate LVMH. According to Forbes Magazine, Arnault is the world's 4th and Europe's richest person, with a 2011 net worth of US$41 billion.-Education and business career:Arnault was born...
, majority shareholder of Dior, is Chairman of both companies and CEO of LVMH. His successful integration of various famous aspirational brand
Aspirational brand
In consumer marketing, an aspirational brand means a large segment of its exposure audience wishes to own it, but for economical reasons cannot...
s into the group has inspired other luxury companies into doing the same. Thus Gucci
Gucci
The House of Gucci, better known simply as Gucci , is an Italian fashion and leather goods label, part of the Gucci Group, which is owned by French company PPR...
(now part of the French conglomerate PPR
PPR (company)
PPR is a French multinational holding company specializing in retail shops and luxury brands. The company was founded in 1963 by the businessman François Pinault and is now run by his son François-Henri Pinault. It is quoted on Euronext Paris and is a constituent of the CAC 40 index...
) and Richemont
Richemont
Compagnie Financière Richemont S.A. is a Swiss luxury goods holding company founded in 1988 by the South African businessman Johann Rupert. Richemont categorizes its businesses into four areas: jewellery, watch making, writing instruments and other, which encompasses clothing and firearms. The...
have also created extended portfolios of luxury
Luxury good
Luxury goods are products and services that are not considered essential and associated with affluence.The concept of luxury has been present in various forms since the beginning of civilization. Its role was just as important in ancient western and eastern empires as it is in modern societies...
brands. The oldest of the LVMH brands is wine producer Château d'Yquem
Château d'Yquem
Château d'Yquem is a Premier Cru Supérieur wine from the Sauternes, Gironde region in the southern part of the Bordeaux vineyards known as Graves. In the Bordeaux Wine Official Classification of 1855, Château d'Yquem was the only Sauternes given this rating, indicating its perceived superiority...
, which dates its origins back to 1593.
Financial data
| Financial Data (in million euros) | 2006 | 2007 | 2008 | 2009 | 2010 |
|---|---|---|---|---|---|
| Sales | 15,306 | 16,481 | 17,193 | 17,053 | 20,320 |
| Net profit | 2,160 | 2,331 | 2,318 | 1,973 | 3,032 |
| Total equity | 11,594 | 12,528 | 13,887 | 14,785 | 18,204 |
Corporate structure
LVMH is basedCorporate headquarters
Corporate headquarters is a term used to describe the entity at the top of a corporation to take full responsibility for the overall success of the corporation, ensures Corporate Governance...
in 30 avenue Hoche in the 8th arrondissement Paris
Paris
Paris is the capital and largest city in France, situated on the river Seine, in northern France, at the heart of the Île-de-France region...
, Île-de-France
Île-de-France (région)
Île-de-France is the wealthiest and most populated of the twenty-two administrative regions of France, composed mostly of the Paris metropolitan area....
, France
France
The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...
. The company is listed on the Euronext Paris
Euronext
Euronext N.V. is a pan-European stock exchange based in Amsterdam and with subsidiaries in Belgium, France, Netherlands, Portugal and the United Kingdom. In addition to equities and derivatives markets, the Euronext group provides clearing and information services...
exchange, and is a constituent of the CAC 40
CAC 40
The CAC 40 is a benchmark French stock market index. The index represents a capitalization-weighted measure of the 40 most significant values among the 100 highest market caps on the Paris Bourse...
index. As of 2010, the group had revenues of €20.3 billion with a net income of just over €3 billion. The group currently employs more than 83,000 people. 30% of LVMH's staff work in France. LVMH operates over 2,400 stores worldwide. Its current business plan aims to tightly control the brands it manages in order to maintain and heighten the perception of luxury relating to their products. For example, Louis Vuitton products are sold only through Louis Vuitton boutiques found in upmarket locations in wealthy cities or in concessions in other luxury goods shops (such as Harrods
Harrods
Harrods is an upmarket department store located in Brompton Road in Brompton, in the Royal Borough of Kensington and Chelsea, London. The Harrods brand also applies to other enterprises undertaken by the Harrods group of companies including Harrods Bank, Harrods Estates, Harrods Aviation and Air...
in London). This practice contrasts greatly with less exclusive brands which can be bought in shopping malls around the world.
Shareholders
At the end of 2010, the only declared major shareholder in LVMH was Groupe Arnault, the family holding companyHolding company
A holding company is a company or firm that owns other companies' outstanding stock. It usually refers to a company which does not produce goods or services itself; rather, its purpose is to own shares of other companies. Holding companies allow the reduction of risk for the owners and can allow...
of Bernard Arnault
Bernard Arnault
Bernard Arnault is a French business magnate who is best known as the chairman and CEO of the French conglomerate LVMH. According to Forbes Magazine, Arnault is the world's 4th and Europe's richest person, with a 2011 net worth of US$41 billion.-Education and business career:Arnault was born...
. The group's control amounted to 47.64% of LVMH's stock (with 42.36% held through Christian Dior S.A. and 5.28% held directly) and 63.66% of its voting rights (59.01% by Dior and 4.65% directly). A further 2.43% of shares were declared as treasury stock
Treasury stock
A treasury stock or reacquired stock is stock which is bought back by the issuing company, reducing the amount of outstanding stock on the open market ....
, with the remainder being free float. LVMH hold 66% of the drinks division, Moét Hennessy, with the remaining 34% held by Diageo
Diageo
Diageo plc is a global alcoholic beverages company headquartered in London, United Kingdom. It is the world's largest producer of spirits and a major producer of beer and wine....
.
Subsidiaries
A partial list including some of LVMH's most well known brands and subsidiaries:| Company | Sector |
|---|---|
| Moët et Chandon Moët et Chandon Moët & Chandon , or Moët, is a French winery and co-owner of the luxury goods company Moët-Hennessy • Louis Vuitton. Moët et Chandon is one of the world's largest champagne producers and a prominent champagne house. The company holds a Royal Warrant to supply champagne to Elizabeth II... |
Wines and Spirits |
| Krug Champagne Krug Champagne Krug—a "négociant-manipulateur" with offices in Reims, the main city in Champagne—was one of the famous Champagne houses who formed part of the membership of the Grande Marques. Krug Grande Cuvée is one of the crown jewels in the LVMH wine division, placed alongside the Moët et Chandon's... |
Wines and Spirits |
| Veuve Clicquot Veuve Clicquot Veuve Clicquot Ponsardin is both a champagne house in Reims, France, and a brand of premium champagne. Founded in 1772 by Philippe Clicquot-Muiron, Veuve Clicquot played an important role in establishing champagne as a favored drink of haute bourgeoisie and nobility throughout Europe... |
Wines and Spirits |
| Mercier Champagne Mercier Mercier is a Champagne producer based in the Épernay region of Champagne. The house, founded in 1858, produces both vintage and non-vintage cuvee. Mercier owned the original rights to the name Dom Perignon but sold the brand to Moët et Chandon in 1930... |
Wines and Spirits |
| Château d'Yquem Château d'Yquem Château d'Yquem is a Premier Cru Supérieur wine from the Sauternes, Gironde region in the southern part of the Bordeaux vineyards known as Graves. In the Bordeaux Wine Official Classification of 1855, Château d'Yquem was the only Sauternes given this rating, indicating its perceived superiority... |
Wines and Spirits |
| Hennessy Hennessy Jas Hennessy & Co., or more simply Hennessy, is a world-leading cognac house with headquarters in Cognac, France. Today, the company of Jas Hennessy & Co... |
Wines and Spirits |
| Glenmorangie Glenmorangie Glenmorangie is a distillery in Tain, Ross-shire, Scotland that produces single malt Scotch whisky. The distillery is owned by The Glenmorangie Company Ltd, whose main product is the range of Glenmorangie single malt whisky. Glenmorangie is categorised as a Highland distillery and boasts the... |
Wines and Spirits |
| Belvedere Belvedere (vodka) Belvedere is a luxury brand of Polish vodka produced and distributed by LVMH. It is named after Belweder, the Polish presidential palace, whose illustration appears on the company's bottles. It is produced exclusively in Poland in the town of Żyrardów and has worldwide distribution.... |
Wines and Spirits |
| Ardbeg Ardbeg Ardbeg Distillery is a Scotch whisky distillery on the south coast of the isle of Islay, Argyll and Bute, Scotland, in the Inner Hebrides group of islands. The distillery claims to produce the peatiest Islay whisky and uses malted barley sourced from the maltings in Port Ellen. It is one of the... |
Wines and Spirits |
| Domaine Chandon California Domaine Chandon California Domaine Chandon is a winery and restaurant located in Napa Valley, California. Established in 1973 by Moët et Chandon, it was the first French-owned sparkling wine producer in Napa Valley.... |
Wines and Spirits |
| Fendi Fendi Fendi is an Italian high fashion house best known for its "baguette" handbags. It was launched in 1925 as a fur and leather shop in Rome, but today is a multinational luxury goods brand owned by LVMH... |
Fashion and Leather Goods |
| Donna Karan Donna Karan Donna Karan is an American fashion designer and the creator of the Donna Karan New York and DKNY clothing labels.-Early life:... |
Fashion and Leather Goods |
| Givenchy Givenchy Givenchy is a French brand of clothing, accessories, perfumes and cosmetics with Parfums Givenchy.The house of Givenchy was founded in 1952 by designer Hubert de Givenchy and is a member of Chambre Syndicale de la Haute Couture et du Pret-a-Porter... |
Fashion and Leather Goods |
| Kenzo Kenzo Takada Kenzo Takada is a Japanese fashion designer. He is also the founder of Kenzo, a worldwide brand of perfumes, skincare products and clothes.... |
Fashion and Leather Goods |
| Berluti Berluti Berluti is a company that manufactures and retails a very exclusive luxury brand of shoes and boots solely for men. It is known for its unique leather finishing. It also makes and sells a line of leather goods such as belts, bags, and wallets with similar finish.It is based in Paris on the rue... |
Fashion and Leather Goods |
| Louis Vuitton Louis Vuitton Louis Vuitton Malletier – commonly referred to as Louis Vuitton , or shortened to LV – is a French fashion house founded in 1854 by Louis Vuitton. The label is well known for its LV monogram, which is featured on most products, ranging from luxury trunks and leather goods to ready-to-wear, shoes,... |
Fashion and Leather Goods |
| Marc Jacobs Marc Jacobs Marc Jacobs is an American fashion designer. He is the head designer for Marc Jacobs, as well as Marc by Marc Jacobs, a diffusion line, with more than 200 retail stores in 60 countries. He has been the creative director of the French design house Louis Vuitton since 1997... |
Fashion and Leather Goods |
| Loewe Loewe (brand) Loewe is a Spanish luxury clothing and accessories brand based in Madrid and is owned by the LVMH Group. Loewe is known around the world as being one of the very best when it comes to luxury leather goods.- History :... |
Fashion and Leather Goods |
| Céline Celine (brand) Céline is a French luxury house founded in 1945 by Céline Vipiana. Today, it is an international luxury goods brand owned by LVMH, purchased in 1996 for 2.7 billion French francs .... |
Fashion and Leather Goods |
| Thomas Pink Thomas Pink Thomas Pink is a retail clothing business started in London in 1984, by three Irish brothers James, Peter and John Mullen. The company was named for an 18th century London tailor who was known for making much sought-after red hunting jackets.... |
Fashion and Leather Goods |
| Acqua di Parma Acqua di Parma Acqua di Parma is an Italian perfume company which produces a lightly scented fragrance.-History:It was founded in 1916 and began in the city of Parma in a small perfume factory and was used up until the '30s and '40s in Europe. The brand was revived in the 1990s, financed by Tod's owner Diego... |
Perfumes and Cosmetics |
| Parfums Christian Dior Parfums Christian Dior Parfums Christian Dior is the make-up and perfumery line of Christian Dior SA, based on the company created by twentieth-century fashion designer Christian Dior. It was created in 1947 with the launch of Miss Dior perfume... |
Perfumes and Cosmetics |
| Guerlain Guerlain Guerlain is a French perfume house, among the oldest in the world. It has a large and loyal customer following, and is held in high esteem in the perfume industry... |
Perfumes and Cosmetics |
| Bulgari Bulgari Bulgari is an Italian jeweler and luxury goods retailer which has been owned by the French firm LVMH since October 2011. The trademark is usually written "BVLGARI" in the classical Latin alphabet , and is derived from the surname of the company's Greek founder, Sotirio Voulgaris... |
Watches and Jewelry |
| TAG Heuer TAG Heuer TAG Heuer is a Swiss luxury watchmaker known for its sports watches and chronographs. It is a division of luxury goods company LVMH Moët Hennessy • Louis Vuitton. The company motto is "Swiss Avant-Garde Since 1860"... |
Watches and Jewelry |
| Zenith Zenith (watchmaker) Zenith SA is a Swiss watch manufacture started in 1865 by Georges Favre-Jacot at the age of 22, in Le Locle in the canton of Neuchâtel.Zenith has a long reputation for the quality and precision of their watches, with 1,565 1st-place precision awards to date... |
Watches and Jewelry |
| Hublot Hublot Hublot is a Swiss enterprise creating luxury watches and founded in 1980 by Carlo Crocco. The company currently operates as a wholly owned subsidiary of France's LVMH.- History :... |
Watches and Jewelry |
| Chaumet Chaumet The House of Chaumet , founded in 1780, is a high end jeweler based in Paris. -Contemporary period : Bankruptcy, Investcorp, LVMH :... |
Watches and Jewelry |
| Sephora Sephora Sephora is a chain of cosmetics stores founded in France in 1970 and acquired by Paris-based conglomerate LVMH in 1997. The Sephora chain includes more than 750 stores in 17 countries... |
Selective Retailing |
| DFS DFS (retailer) DFS Galleria is a chain of upscale department stores and shopping malls comprising high-end boutiques, located primarily within Oceania and around the Pacific Rim. Its website proclaims it to be "the world's leading luxury retailer catering to the travelling public"... |
Selective Retailing |
| Le Bon Marché Le Bon Marché Le Bon Marché is the name of one of the best known department stores in Paris, France. It is sometimes regarded as the "first department store in the world". Although this depends on what is meant by 'department store', it may have had the first specially designed building for a store in Paris... |
Selective Retailing |
On 7 March 2011, LVMH announced the acquisition of the 50.4% family-owned shares of the Italian jeweller Bulgari
Bulgari
Bulgari is an Italian jeweler and luxury goods retailer which has been owned by the French firm LVMH since October 2011. The trademark is usually written "BVLGARI" in the classical Latin alphabet , and is derived from the surname of the company's Greek founder, Sotirio Voulgaris...
and the intention to make a tender offer for the rest (publicly owned). The transaction is about $5.2 billion.