Bernard Arnault

Arnault trained as an engineer at the École Polytechnique and went into his father's construction firm, Ferret-Savinel, in Roubaix, turning it towards property. When François Mitterrand's Socialist government came in in 1981 he moved to Florida and built condominiums for three years. The story he tells of his conversion to luxury is that a New York taxi driver, asked what he knew of France, could not name the president but could name Christian Dior. Whether or not the taxi existed, the observation was correct, and when he came home in 1984 he acted on it. The Boussac textile group, which owned Dior along with Le Bon Marché, Conforama and a mass of loss-making mills, was in receivership; the state had sunk about a billion francs into it and wanted a buyer who would preserve jobs. With Antoine Bernheim of Lazard arranging the financing and reportedly about $15 million of his family's money, Arnault won it. Within two years he had sold most of the assets, cut somewhere between eight and nine thousand jobs, and kept Dior and Le Bon Marché. The government said it had been misled about his intentions; Arnault said he had saved what could be saved. Both statements are still made. The Dior case on this site takes the story from there.

The second act was LVMH itself. Louis Vuitton and Moët Hennessy had merged in 1987, and by 1988 the two founders, Henry Racamier and Alain Chevalier, were at war. Racamier invited Arnault in as an ally. Arnault, financed with Guinness, built a stake, sided with Chevalier, then removed Chevalier, then fought Racamier through the French courts and removed him too. By January 1989 he chaired the group and controlled it through a chain of holding companies — Agache, then Christian Dior SE — that the family still uses. The French press called him the wolf in cashmere and he has never much objected. What followed was the buying spree that made the modern group: Celine, Loewe, Fendi, Sephora, Tag Heuer, Bulgari, Loro Piana, Tiffany, and the couture house itself, bought from his own holding in 2017. The Sephora and Tiffany cases show what he does with an acquisition once it is inside.

His record has three passages that should not be smoothed over. The first is Gucci: in 1999 he built a 34% stake by stealth, was defeated by François Pinault's white-knight investment, and lost the one house he most wanted. The second is Hermès: in 2010 LVMH disclosed a 17% stake built through equity swaps that avoided the usual disclosure thresholds; the AMF fined the group €8 million in 2013 and the Hermès family locked its shares in a holding to keep him out, as the Hermès case describes. The third is succession. Arnault has five children in five senior roles, has had the board raise the chief executive's age limit twice, to 80 and then 85, and has not named a successor. He is 77. The structure that let him make every decision quickly for forty years is now the structure that makes the last one hardest.