The family behind French luxury goods company Hermes has finalised the creation of a holding company aimed at defending the family business from a hostile takeover.
Under the new structure, family shareholders will find it difficult to sell their stake to non-family members, while the holding company, named H51, will have a priority right to buy an additional 12.3% of the luxury house in case a family member plans on selling.
The holding, which controls 50.2% of the group’s share capital, will be headed by sixth-generation Julie Guerrand, who currently sits on the supervisory board of the Paris-based company.
H51’s board of directors will include two other members of the founding family, Hermes executive chairman Bertrand Puech and general director of operations Axel Dumas.
Plans to create a holding company were first announced in December 2010, two months after LVMH, the world’s largest luxury goods group, said it had secretly bought 17% of Hermes’s shares.
Since then, LVMH, which is controlled by Bernard Arnault, has increased its stake to 21.4%.
In response, 52 of the 53 members of the family who own Hermes shares announced they would create a holding company to protect the family’s controlling position.
In September, a French court allowed the family to create such a holding without having to buy out other shareholders.
"The creation of this structure confirms the unity of the family in its commitment to defend Hermes’s independence to preserve its values and culture," the family said in a statement released on 14 December.
“Despite the suddenness of the attack, the family has never doubted the solidity of its control,” they added.
Hermes was founded in 1837 by Thierry Hermes. Today, the family controls about 73% of the group and nine members work at the company, including Peuch and creative director Pierre-Alexis Dumas.
In 2010, the group posted revenues of €2.4 billion, up from €1.9 billion in 2009.