LVMH Piles Up Assets
The world's largest luxury goods group Moet Hennessy Louis Vuitton (LVMH) of France and Russia’s chain of cosmetics and perfumery Ile de Beaute are creating a venture, where LVMH’s Sephora will own 45 percent and Russia’s partner will have the remainder. The overall worth of Ile de Beaute was estimated at between $350 million to $370 million. It emerged that LVMH intends to set up Russia’s biggest perfumery holding that will also include its distributing operator, Seldico.
Under the deal completed on Friday, LVMH’s retailer Sephora became the holder of 45 percent in Russia’s Ile de Beaute. The matter at stake is creating a venture, where Sephora will own 45 percent and United Europe – S.B. (100 percent subsidiary of United Europe) will have the remainder, said Igor Denisov, co-owner of United Russia. Denisov and Andrei Gribkov owned 69 percent and 31 percent respectively in United Europe as of December 31, 2007.
The deal provides for the extension of French partner’s share to the majority ownership. Neither the terms of the option nor the deal worth have been disclosed. It is said that managers of Ile de Beaute will remain in the company, while top managers of LVMH will be attracted as well, supervising strategic planning at it.
According to a source with the rival chain, the whole Ile de Beaute was estimated at $350 million to $370 million. Russia’s distributor Seledico will join the venture later on. LVMH owns Seledico from 2006; the brand portfolio includes Christian Dior, Givenchy, Guerlain, Kenzo, Fendi, Emilio Pucci.
United Europe Holding was created in 1992. It comprises United Europe Holding distributor, Ile de Beaute retailer, perfumery and cosmetics production facilities, developer’s and logistic businesses. The chain unites 103 stores all over Russia; the 2007 revenues of retailer division stood at $279.98 million.
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All the Article in Russian as of Oct. 06, 2008
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