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Published: Wed, April 26, 2017
Economy | By Melissa Porter

LVMH, Arnault to simplify Christian Dior business structure

LVMH, Arnault to simplify Christian Dior business structure

Christian Dior makes bespoke and ready to wear men's and women's clothes, which it sells through its network of 198 stores worldwide.

LVMH, otherwise known as LVMH Moet Hennessy Louis Vuitton, is a business empire that owns Louis Vuitton, Marc Jacobs, Sephora, Givenchy, Fendi, Tag Heuer, Bulgari, Kenzo and various upmarket alcohol and cosmetics brands. The buy, then, will start with a new restructuring of the Christian Dior Couture and Parfums Christian Dior brands.

Arnault already owns 74.1 per cent of Christian Dior, so the launch of the takeover bid is for the rest of the shares it doesn't own.

LVMH is also set to buy Dior's high-end fashion range for a whopping 6.5bn euros (£5.5bn).

French business magnate, art collector and billionaire Bernault Arnault has moved to consolidate the corporate structure of Christian Dior, bringing all of the Paris-based fashion house's operations together under the LVMH luxury umbrella. LVMH shares rose upwards of 4% with news of the merger between the two fashions titans. LVMH in 2014 ended the drama, distributing the shares to investors. There are potential all-cash and all-share alternatives.

Models presenting creations from the Christian Dior Spring/Summer 2017 Haute Couture collection by Italian designer Maria Grazia Chiuri at the Ginza Six retail complex in Tokyo last Wednesday.

"The price we're paying is perhaps a little expensive, but in 30 years we'll be happy we did it", Mr. Arnault said at a press conference.

"As with creativity and product development, I believe that the Dior touch has to remain distinct in production", Toledano said.

Looking at turnover, LVMH is the world's largest luxury group. The bid is 15 percent above where the stock closed Monday.

Mr Arnault said the move illustrated his family's commitment and confidence in LVMH and its brands.

Luca Solca, the head of luxury goods at Exane BNP Paribas, said: "It adds a strong brand to the LVMH portfolio at a reasonable valuation".

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