Hermes International announced this Tuesday that it was handing over the reigns of the company to the sixth generation of descendants to founder Thiery Hermes. They are strengthening their grip for fear of LVMH Moët Hennessy Louis Vuitton, their large rival, buying them out. Hermes, as you know, has been making the famous Kelly bag for 175 years along with their famous silk scarves with horse theme prints. This iconic brand wishes to stay within the family according to Chief Executive Patrick Thomas which is why the brand has decided to gradually begin the process of passing the company.
Axel Dumas, the 42 year old chief operating officer is taking over for Chief Executive Patrick Thomas who will be 65 in a couple weeks. Mr. Dumas, a descendant of founder Thierry Hermès, will become joint-CEO alongside Mr. Thomas at the end of May 2013 and will assume full managerial control at a later unspecified date. The change in management returns the reins of the company to the family, which in 2010 had a backseat role before an unfolding drama with LVMH.
Two years ago, LVMH, the holding company for brands including Louis Vuitton, Fendi, Marc Jacobs and Donna Karan, stealthily began to build a 22% stake in Hermès, swallowing up the majority of the shares of Hermès that are in the hands of the general public.
Faced with what Mr. Thomas called “an intruder in our garden,” the Hermès family closed ranks, but not before the market speculated that some family members would sell at the right price.
Although LVMH insisted that their intentions were friendly and they were not planning a takeover, the Hermès family interpreted the stake buildup as an assault on its family unity—only a few months after the death of the family’s patriarch, Jean-Louis Dumas.
The first nonfamily member to run Hermès, Mr. Thomas, who has been boss since 2006, guided the company through its standoff with LVMH. Yet he was seen by many family members as a surrogate member of the clan.
Though LVMH remains a major shareholder, the Hermès family feels that it has won the battle for now. Last year, multiple Hermès family members locked up shares representing just over half the capital in a new holding company, with the intent to keep them out of LVMH’s hands for at least 20 years.
“I am glad a member of the Hermès family has been brought in to succeed me,” Mr. Thomas said Tuesday.
“In 15 days’ time I will be 65 years old… for some time I have been preparing my succession,” Mr. Thomas said at the company’s annual shareholders meeting Tuesday.
Several of Mr. Dumas’s cousins have joined the company or been promoted to senior positions since LVMH’s arrival. Of the roughly 40 members of the sixth generation, about 10 work in the family business. Julie Guerrand quit her banking job with Rothschild last year to become the director of corporate development. Eric de Seynes became the president of the supervisory board. The Hermes family puts their brand first and will continue to maintain a strong and successful brand desired by all.
Amy Nicole Marietta | Elite Daily
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