LVMH increases Hermes stake to 20 percent
Global luxury retailer LVMH said Tuesday it had increased its stake in smaller rival Hermes to more than 20 percent, sparking fresh speculation about its ultimate intentions.
In October, LVMH built up a stake of 17.1 percent in Hermes and said at the time it could increase it amid intense speculation that it planned ultimately to take control of Hermes.
LVMH said in a statement to the market regulator that as of Dec 17 it held 20.21 percent of Hermes after buying more shares on the open market.
The group, owned by billionaire Bernard Arnault, said it would continue to buy more shares but did not intend to take control, to make a public offer for the company nor to seek seats on the board.
The investment in Hermes was "strategic and long-term," it added.
LVMH is the single largest shareholder in Hermes but it is controlled by the descendents of founder Thierry Hermes who between them hold 73.4 percent of the capital.
Hermes declined to comment on the matter when contacted by AFP.
LVMH, the world's leading luxury group, controls brands such as Louis Vuitton, Givenchy, Dom Perignon and Dior.
© 2010 AFP