LVMH likes to have the family founders sticking around through minority ownership
LVMH, the huge luxury conglomerate owned by the Arnault family, likes acquiring family businesses. Here’s a selection of ones it’s bought in the past: Givenchy, Krug, Emilio Pucci, Ruinart, R.M. Williams…the list goes on. In fact, out of the 50-plus brands owned by LVMH, at least a third of them have had family businesses origins. And now LVMH appears to be targeting the German market, acquiring the premium luggage manufacturer Rimowa for €640 million.
Here’s what Bernard Arnault, CEO of LVMH, said about the deal. “It brings me great pleasure that Rimowa will be the first German house to join the LVMH Group. Germany is recognised all over the world for the vitality of its family businesses and for the quality of their products.” He’s also appointing one of his sons Alexandre Arnault to be co-CEO with the current boss of Rimowa, Dieter Morszeck, who will also keep a minority stake in the business. The minority ownership deal for the family behind the business is a favourite acquisition strategy of Arnault – it works as a sort of earn-out whereby the family’s interests in their business are aligned with those of LVMH as long as they stick around.
Succession moves at The New York Times Company
Arthur Gregg Sulzberger, a member of the fifth generation of the family that own one of America’s best-known media groups, has been appointed deputy publisher and is set to replace his father Arthur Sulzberger Jr at the helm of the New York Times. The older Arthur, 65, is expected to set down as publisher sometime in the next few years, although no firm date has been set. Arthur Gregg, 32, competed for the job with two of his cousins, but after a lengthy selection procedure was chosen as the anointed heir.
Are family offices the new hedge funds?
Yes, according to a Bloomberg article on why financial whiz kids now want to work for family offices. Here’s what the piece said: “An appealing aspect of family offices, according to consultants, is that they look a lot like hedge funds in the glory days of the 1980s and ’90s: secretive and lightly regulated”. That’s a big plus, according to those looking for jobs in the sector. But let’s hope that unlike the hedge-fund world, which is struggling to hold onto investors’ money, family offices are not encountering the same problems in 20-plus years time.