In a strategic move with implications spanning decades, renowned French billionaire Bernard Arnault has taken deliberate measures to solidify his control over the LVMH Group. What was initially planned to transpire upon his eventual passing has been set into motion due to the attainment of the age of 25 by his youngest offspring, Jean Arnault, as reported by Italy’s Il Sole 24 Ore newspaper.
LVMH, the prestigious luxury conglomerate led by Bernard Arnault, has made a significant impact on the haute horology scene, becoming a prominent player in the watch industry. The group’s journey into watchmaking began with the acquisition of Hublot, celebrated for its innovative designs. Subsequently, LVMH expanded its horological portfolio by acquiring TAG Heuer, known for sports watches and chronographs, and Zenith, renowned for its exceptional mechanical movements. Most notably, LVMH added Tiffany & Co., famous for its exquisite jewelry and luxury watches, further enhancing its presence in the high-end watch and jewelry market. Louis Vuitton’s watch director is also none other than Jean Arnault, Through these strategic acquisitions, LVMH has leveraged its resources and expertise to offer a diverse range of luxury timepieces, leaving a lasting mark on the world of luxury watches.
Now, back to keeping control of his beloved luxury group. Instead of control over LVMH shifting to a Belgian foundation, it will now be vested in a limited partnership known as Financière Agache. Within this limited partnership structure, two distinct categories of partners exist: general partners endowed with management authority, and limited partners holding economic rights. In the present case, Ludovic and Stéphanie Watine, the progeny of Bernard’s late sister, are entrusted with the economic prerogative. Nonetheless, the ultimate locus of control remains vested with the general partner, Agache Commandité. The capital distribution within Agache Commandité is characterized by an equitable division among Bernard Arnault’s five offspring, who, under this arrangement, are legally prohibited from divesting any of their shares for an extended period of 30 years.
This stipulation ensures the preservation of long-term familial control. Bernard Arnault, currently at the age of 74, continues to serve as director of the company, wielding unrestricted powers, until he reaches the venerable age of 95. The approach imparts stability, shared vision, trust, and internal control. While external perspectives and professional management bring fresh insights and expertise, the presence of family leadership often takes precedence in maintaining the legacy and ethos of these entities.