The French luxury group LVMH, led by billionaire Bernard Arnault, is to take full control of Christian Dior, in a complex €12bn (£10bn) deal that reunites the fashion house with the perfume and other Dior brands.
The Arnault family, which holds a controlling stake in LVMH, owns 74.1% of Christian Dior, one of the world’s top fashion houses. The family said it wants to buy the remainder for €12bn, or €260 a share. It will then sell Christian Dior Couture to LVMH for €6.5bn.
LVMH, the world’s largest luxury company, owns Christian Dior perfumes and beauty after a deal in the 1960s to raise capital for the then-struggling brand. The latest transactions will bring the whole Christian Dior brand under one roof, from fashion to fragrances.
Arnault, France’s richest man and chief executive of LVMH, which was formed from the 1987 merger of fashion house Louis Vuitton with champagne and cognac producer Moët Hennessy, hailed the deal as an “important milestone” for the group.
He said the transactions demonstrated his family’s commitment to LVMH and would result in “the simplification of the structures, long requested by the market, and the strengthening of LVMH’s fashion and leather goods division thanks to the acquisition of Christian Dior couture”.
The move was welcomed by analysts and investors, and LVMH shares rose more than 4% to €223.55 in morning trade on Tuesday.
Luca Solca, the head of luxury goods at Exane BNP Paribas, said: “It adds a strong brand to the LVMH portfolio at a reasonable valuation.”
Paris-based Christian Dior has 198 stores worldwide including one in Mayfair, central London. It posted revenues of €2bn and underlying earnings of €418m last year.
The fashion house was founded by the French designer Christian Dior in 1946 with backing from the cotton fabric magnate Marcel Boussac. It later branched out into perfume, watches, jewellery, shoes and accessories.
His debut collection was quickly christened the “new look”, with a calf-length full skirt, cinched waist and fuller bust. Dior’s clothes were worn by stars such as Rita Hayworth, and he was invited to present the collection privately to the British royal family. He died in 1957.
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