Dec 14, 2011
Hermes family finalises holding to prevent takeover
Dec 14, 2011
PARIS Dec 14 (Reuters) - The family owners of Hermes said on Wednesday that they had finalised the creation of a holding company with 50.2 percent of the share capital to protect the luxury house from hostile takeover.
The creation of the holding, dubbed H51, has been in the works since last autumn when fashion giant LVMH revealed that it had secretly built up a 17 percent stake in Hermes. LVMH's move raised fears among some family members that it was seeking to take over the group. "The creation of this holding structure confirms the unity of the family in their commitment to defend the independence of Hermes to preserve its values and culture," the family wrote in a press release. The statement also said that the holding H51 had negotiated a priority right to buy a further 12.3 percent of Hermes shares in the eventuality that some family members wanted to sell. Speculation that LVMH was preparing a bid has propelled Hermes' share price to stratospheric heights this year, up almost 50 percent since January amid a moribund French market overall. The creation of the holding may dampen Hermes shares' speculative appeal. (Reporting by Leila Abboud)
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