LV'S 17% Stake In Hermes: Add More To The Kingdom.

　　 The world's largest Luxury goods Group LVMH (Louis Weedon) announced the day before, has acquired famous Latest fashion And 14.2% of the luxury brand Hermes (Hermes), plus the Hermes convertible derivative on hand, has a total holding volume of 17.1% and a total of 1 billion 450 million euros. LVMH claims to have no intention of controlling the competitor, but analysts believe that LVMH In the end, a takeover will be made to add to the more than 50 kingdoms of LV, Moet and Chandon, TAGHeuer watches and so on.

LVMH's massive holdings of Hermes shares reflect the revival of the luxury market. Bain&Co., global management consultancy, points out that this year's luxury sales are expected to rise to a new high since 2007, driven by strong demand in China and the recovery of the US economy. LVMH announced earlier this month that sales rose by 24% in the third quarter, driven by Chinese buyers. Hermes also announced in July that sales in the first half of the year increased by nearly 23%.

LVMH issued a statement that it now has about 15 million 20 thousand shares of Hermes and can increase its derivatives to about 18 million 20 thousand shares after changing its shares. LVMH originally controlled less than 5% of Hermes shares and became the largest shareholder outside the Hermes family after its holdings.

The statement also stated that the goal of LVMH is to "become a long-term shareholder of Hermes" and to contribute to the preservation of Hermes's "family and French characteristics". The group said it would give full support to Hermes's founder family and management.

Hermes is controlled by the founder family. The family members control about 72% of the shares, while the rest are publicly issued. In May 1st, the death of Hermes chief executive, Dimma, prompted speculation that family members would sell shares in the company, and Hermes shares soared to 77% since then, and 176 euros in Paris stock market last Friday.

Arnaud, the 61 year old LVMH chairman, is France's richest man. Although Hermes is a rival in the market, he often praises Hermes, and has repeatedly hinted at the past two years that he is interested in buying the other side. Solca, a Sanford Bernstein analyst who specializes in luxury market, believes that the LVMH is the leading position for LVMH to buy Hermes in the future, and that LVMH belongs to the category of "mass luxury" to a large extent. Hermes focuses on more high-end products, which can complement LVMH.