ZURICH (Reuters) – French billionaire Bernard Arnault, Europe’s richest man and head of the high-end fashion division of champagne group LVMH, has bought a stake in smaller luxury goods rival Richemont, Bloomberg reported on Tuesday.
The exact size of the Cartier jewelery owner’s shareholding and Arnault’s intentions are unclear, the report said.
Representatives for Arnault did not immediately respond to a request for comment.
The report said the investment was small and part of a broader portfolio owned by the Arnault family of investments in publicly listed companies.
Richemont, whose shares rose 2.8% on the news, declined to comment. The company’s shares have risen 21% this year.
Paris-based LVMH, whose brands include fashion houses Louis Vuitton and Christian Dior, watchmakers Hublot and Tag Heuer, and champagne maker Dom Perignon, has bought stakes in rivals.
The world’s largest luxury company revealed in 2010 that it had taken a stake in bag maker Hermès from Birkin.
The owners of the Hermès family reacted by tying up their holdings, and LVMH eventually divested its stake in 2014.
Richemont’s position may also be difficult to take over, if that is Arnault’s intention.
The company, which also owns Swiss watchmakers IWC, Piaget and Jaeger-LeCoulture, is controlled by Chairman Johann Rupert via a two-class block of shares giving him 51% of voting rights.
John Cox, an analyst at Kepler Chevrot, said the investment appeared to be a personal stake for the Arnault family, although he noted Bernard Arnault’s admiration for Richemont’s jewelry business.
“Arnault has made it no secret that he believes Richemont’s Cartier and Van Cleef & Arpels are global brands and I am sure LVMH is interested and has the financial resources to do a deal,” Cox said.
“However, Johann Rupert of Richemont has repeatedly said that the company is not for sale and he has no interest in any kind of association.”
Arnault said in January that Robert was an “outstanding leader” and that he did not want to “spoil his strategy.”
He added: “I understand that he wants to remain independent. I find that very good. If he wants support to maintain his independence, I will be there.”
Last month, Richemont unveiled a management overhaul, promoting Nicolas Bos, head of jewelry brand Van Cleef & Arpels, to become group CEO.
However, Robert said he has not diminished his role in the company he created.
“I’m not going to back down but I’m asking Nicola to take over some direct reports,” the 74-year-old said last month.
