LVMH invests 74 million euro and scales Tod’s to reach 10% of ownership

LVMH invests over 74 million euro to triple its participation inside Tod’s Group and reach 10% of the total. “Through this operation, we strengthen the 20-year-long friendship between the Arnault and Della Valle families”, reads the note. The operation, which closed on Wednesday April 28^th, lit a new fire under the rumors of a potential sale of Tod’s.

74 million euro

Delphine (a holding company completely owned by LVMH) bought 2,25 million shares of Tod’s from Diego Della Valle & C (company fully owned by Diego Della Valle). Simply put: 6.8% of the Italian group’s capital, which controls Tod’s, Hogan, Fay and Roger Vivier. The amount is summed to the 3.2% of shares already owned by LVMH. The agreed-upon price-per-share was of 33.10 euro (with the market price closing at 35.3 euro yesterday). Once the operation is closed, Diego Della Valle will still, directly and indirectly, still hold 63.64% of the Group’s shares.

The comments

“The friendship with Diego Della Valle and his family dates back to over 20 years ago, and it’s a consolidated relation made of shared human and professional values. We are very happy to strengthen this partnership”, commented Bernard Arnault. “I am happy with this transaction, which consolidates our friendship – repeats Diego Della Valle -. We share the values for luxury, quality and product appeal. This can represent a good reason to consider additional opportunities to take up in the future”.

Reactions

Reuters referred to some sources that described the operation as “friendly support”. According to Bloomberg, “this move may prompt speculation LVMH could take a further stake in the company”. WWD also reminded how analysts have long been speculating over a potential sale of Tod’s, specifically to Arnault and LVMH. Counter to that, Jefferies’ analyst, Flavio Cereda, stated that there could be additional scaling by LVMH in Tod’s. An increment that, at least for now, Reuters excludes.

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