June 19, 2013 / 12:40 PM / 5 years ago

Hermes to sue LVMH over equity swaps to build stake

A couple walk with Hermes shopping bags as they leave an Hermes store in Paris March 21, 2013. REUTERS/Philippe Wojazer

PARIS (Reuters) - Hermes (HRMS.PA) on Wednesday has launched a fresh round of legal proceedings against arch-rival LVMH (LVMH.PA) to obtain the cancellation of equity swaps LVMH used to stealthily amass its stake in the French luxury goods maker.

The new move in the Paris commercial court comes on top of a similar complaint Hermes lodged against LVMH in criminal courts in July 2012.

Hermes argues that LVMH had the intention of building up a stake in Hermes when it bought equity swaps in 2008 and should have informed the market of its intention.

Those swaps were initially supposed to be settled in cash, but ended up being settled in Hermes shares.

“The tribunal... will wait until the end of the penal investigation before launching its (new) procedure,” a spokeswoman for Hermes said on Wednesday.

Hermes owners have been at odds with LVMH, the luxury group founded by billionaire Bernard Arnault, since it revealed in 2010 that it had secretly built up a 14 percent stake in Hermes. This was later increased 22.6 percent.

Last month, the French stockmarket regulator AMF called for LVMH to receive the maximum fine for having failed to disclose moves to build up its holding in the 175-year-old maker of Birkin and Kelly handbags.

The sanctions commission of the AMF is due to decide on LVMH’s fine by July 31.

LVMH, which denies any wrongdoing, declined to comment.

Reporting by Geert De Clercq and Pascale Denis, writing by Astrid Wendlandt, Editing by David Holmes and David Cowell

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below