LVMH’s Arnault family has taken majority control of Heng Long, the crocodile leather supplier owned by the Koh family, in what is the luxury goods company’s second purchase this year of a top-end family business.
Paris-based LVMH, chaired by Bernard Arnault, said in a statement that it will own 51% of Heng Long, while the founding Koh family will reduce its stake to 49% from its earlier 74% ownership of the Singapore-based company.
Arnault’s move follows LVMH’s recent acquisition of yet another family-owned business, the iconic jewellery maker Bulgari. Arnault reportedly said at the time of the purchase: “Families that have over several generations built up an emblematic brand of the highest quality craftsmanship can appreciate the interest in joining LVMH.”
The acquisition of Heng Long, worth around S$161 million (€92 million), will see fourth-generation family members Chon Tong Koh and Choon Heong Koh remaining managing director and executive director respectively of the business.
Buying the crocodile leather supplier will add to LVMH’s existing portfolio of luxury fashion and leather brands, which include the famous Louis Vuitton bags, Givenchy and Marc Jacobs. Founded in 1987 after Arnault used his father’s money to purchase fashion house Christian Dior, the second-generation is also currently involved in the management of LVMH.
Heng Long has a much longer history, founded in the early 1950s, and today serves as a supplier of quality leather to some of the top luxury companies. It had revenues of S$53.7 million (€31 million) in 2010, dwarfed by LVMH’s €2.3 billion.