Luxury group Richemont opposes Bluebell's bid for board position

  • Richemont chairman says candidate too close to LVMH
  • Rupert says Bluebell should not represent investors
  • Analyst says changes will ultimately be up to Rupert

ZURICH, Aug 15 (Reuters) - Richemont (CFR.S) on Monday urged shareholders to vote against appointing a representative of activist investor Bluebell Capital Partners to the luxury goods firm's board, citing his links to rival LVMH Moet Hennessey Louis Vuitton .

Chairman Johann Rupert asked shareholders to reject the appointment of Bluebell co-founder Francesco Trapani at the shareholders meeting on Sept. 7, seeking to derail Bluebell's bid to broaden representation on the board of the Cartier jewellery group. read more

Trapani was the chief executive of Bulgari when it was bought by LVMH in 2011 and was on LVMH's board of directors from 2011 to 2016 where he was also adviser to Bernard Arnault, its CEO and chairman.

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"LVMH is one of our company's key competitors," Rupert wrote in a letter to shareholders.

"The board may not responsibly recommend to shareholders to let a person who has a long history of association with that group – as well as a personal relationship with that group's main shareholder – become a director of our company and intervene in our company's decision-making process," he said.

Bluebell has been approached for comment.

The company, which last year triggered an overhaul at French food group Danone (DANO.PA), wants Richemont to concentrate on jewellery and watches rather than online retail. read more

Bluebell told Reuters last month it had been involved in Richemont for 1-1/2 years and had a 105 million Swiss franc ($111 million) stake. Richemont has a market capitalisation of almost 59 billion francs, based on Refinitiv Eikon data.

But Bluebell's plans for a board seat have triggered a frosty response from the Richemont chairman, who has said he would not be "blackmailed" into making changes.

The South African billionaire controls the world's second biggest luxury company via non-listed B-shares which represent 9.1% of the capital, but 50% of the voting rights.

Rupert said on Monday shareholders holding ordinary traded A-category shares had the right to board representation but did not think Bluebell, which has "a relatively small stake in the company, has legitimacy to represent all 'A' shareholders on the Board."

Richemont proposed that existing board member Wendy Luhabe be elected to represent A shareholders. It also recommended shareholders reject Bluebell's proposal for all directors to be categorised as representing A or B shares, and that the number of directors from both shareholder groups be equal.

"Activists, particularly with such as small stake, are dreaming if they think they can force through governance changes," Kepler Cheuvreux analyst Jon Cox said, adding that any changes were ultimately up to Johann Rupert.

($1 = 0.9432 Swiss francs)

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Reporting by John Revill; Editing by Jason Neely and Edmund Blair

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