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LVMH boss to take full control of Christian Dior

Tuesday, April 25, 2017 - 01:46

LVMH and billionaire businessman Bernard Arnault have announced a deal to simplify their relationship with Christian Dior by buying out its minority shareholders. As Sonia Legg reports, the transaction aimed at boosting LVMH's earnings sent shares in the luxury goods group to record highs.

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Last week Christian Dior was showing off a new store in Tokyo and the Couture House's first female designer. (SOUNDBITE) (English) FIRST WOMAN FASHION DESIGNER FOR CHRISTIAN DIOR, MARIA GRAZIA CHIURI, SAYING: "I'm very happy to have this opportunity, I think it is a good message for the other women that everything is possible." The 70 year old luxury brand has been worn by film stars from Grace Kelly and Elizabeth Taylor to Jennifer Lawrence and Natalie Portman. Those credentials perhaps the reason why LVMH wants to have more control. It already owns Dior's perfume and beauty business so spending 6.5 billion euros on Couture sent LVMH's shares up 4 percent to a record high. (SOUNDBITE) (English) IG SENIOR ANALYST, CHRIS BEAUCHAMP, SAYING: "LVMH is becoming the Unilever of the luxury brands market. It's bringing more and more brands in house and this move to consolidate Dior with the LVMH family is a very sensible one." French billionaire Bernard Arnault will combine the Dior fashion brand with his LVMH group as part of a 12 billion euro move to simplify his business interests. That includes buying a near 26 percent stake in the Dior holding company, which itself has a 41 percent stake in LVMH. Confusing maybe but one thing's clear. (SOUNDBITE) (English) IG SENIOR ANALYST, CHRIS BEAUCHAMP, SAYING: "We are seeing a world where luxury is continuing to be in demand. The fact that you have got this broad-based firm that is well received by the market shows you have the brand power to appeal to high-end consumers on a number of different fronts." News that the deal was in the bag also sent Dior's shares to a record high - after a 13 percent rise. The new business model considered likely to boost earnings for both brands.

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LVMH boss to take full control of Christian Dior

Tuesday, April 25, 2017 - 01:46