LVMH acquires Bulgari
Something is rotten on Avenue Montaigne and it's not just the demise of Galliano's career. Bridget Foley, executive editor of WWD, called the mood in Paris reminiscent of Alexander McQueen's death in 2010.
But maybe this dark cloud is a helpful diversion for Bernard Arnault, the CEO of LVMH and Christian Dior who just acquired yet another independent house. This time it's Bulgari, the Italian luxury jewelry company, family-owned since 1884.
Arnault announced the $6 billion acquisition today. While fashion insiders busy themselves with speculation over Dior's next creative chief, it appears Arnault was onto his next big deal, barely stopping to mourn the loss of his most-prized designer.
Karl Lagerfeld of Chanel felt that Arnault treasured Galliano, saying "I'm furious with [Galliano] because of the harm he did to LVMH and Bernard Arnault, who is a friend, and who supported him more than he supported any other designer in his group, because Dior is his favorite label. It's as if he had his child hurt."
So maybe Bulgari is Arnault's retail therapy?
The news of the acquisition doesn't bode well for Hermès, the house down the street on Rue du Faubourg Saint-Honoré. Arnault first surprised the fashion industry in October when he announced that LVMH had acquired a 20.2 percent stake in Hermès.
The family-owned house pushed back and continues to grow more hostile towards LVMH. WWD reports that Hermès International chief executive officer Patrick Thomas lashed out at Arnault on Friday, saying, "If you want to seduce a beautiful woman, you don't start by raping her from behind."
Is our French that poor, or has the Parisian accent sounded a bit ugly lately?
As LVMH continues to acquire everything in its wake, a twenty-first century saga of family versus conglomerates, tradition versus trading floors, is getting more colorful.
While the three families of Hermès -- Dumas, Puech and Guerrand-- still own more than 70 percent of the capital, Thomas is convinced that Arnault is trying to accrue more shares. "What makes us say that they probably have more is that they are not declaring more," said Thomas.
With the news of Arnault's most recent acquisition, Hermès has cause to worry.
But the sad prose in Paris continues. Off-the-wall? Offensive? Drunken and self-destructive? Let's hope Galliano hasn't blazed a harmful trail for his neighbors at Faubourg. Divided French fashion houses simply cannot stand any better than drunken designers.