What are the LVMH subsidiaries?

LVMH is a French multinational corporation and conglomerate with a focus on luxury goods. The company, which is officially known as LVMH Moët Hennessy Louis Vuitton, was founded in 1987 by Bernard Arnault, Alain Chevalier, and Henry Racamier. Arnault, a French investor, had the idea to create a luxury brand group from the outset. To realize this vision, he collaborated with the CEO of Moët Hennessy Alain Chevalier and the president of Louis Vuitton Henry Racamier. The integration of these aspirational brands was ultimately successful and has been replicated by other companies in the industry. At the time of writing, LVMH operates 75 subsidiaries which it calls houses across six core sectors: wines and spirits, fashion and leather goods, perfumes and cosmetics, watches and jewelry, selective retailing, and other activities.

History of LVMH

LVMH is a French multinational holding corporation and conglomerate with a core focus on luxury items.

The company owes its name to the merger that preceded its formation; namely, that of French fashion house Louis Vuitton (LV) and wine and spirits company Moët Hennessy (MH) in 1987.

How did this vast company – which is now worth around $330 billion – come to be?

Bernard Arnault

No LVMH founding story could omit to mention its founder, the French billionaire businessman Bernard Arnault.

In 1984, Arnault learned that the French government was looking for a buyer for a failed textile empire that also owned several other companies.

The failed empire was known as Boussac, and one of the companies it owned was the fashion house Christian Dior.

To buy Boussac, the 35-year-old Arnault ponied up $15 million of his own money with $45 million from the French financial services company Lazard Frères (now Lazard).

By the end of 1989 and just two years after acquiring Boussac, Arnault laid off 9,000 workers and sold its textile and disposable diaper division for around $500 million.

The merger between Louis Vuitton and Moët Hennessy

In 1984 and quite separate from Arnault’s ambitions, Louis Vuitton announced it would merge with Moët Hennessy to create a joint holding company with more than $2 billion in revenue.

In charge of the new company known as LVMH was former steel tycoon Henry Racamier.

The deal was initially seen as a way for Louis Vuitton to expand and to protect Moët Hennessy from a takeover.

However, at some point, management from Louis Vuitton suspected that Moët Hennessy had nefarious intentions to take it over.

A torturous and protracted court battle then ensued with the families of both companies at odds over the best strategy moving forward.

Racamier hires Arnault

In a move that would prove to be his undoing, Racamier hired Arnault to bolster his support as disagreements between the Vuitton family, Moët Champagne, and Hennessy Cognac continued.

However, Racamier and Arnault themselves also clashed over their different management styles.

In the end, Arnault acquired a significant 34.5% stake in LVMH and, in 1989, forced Racamier to resign from his position as chairman after winning a court battle.

Victorious, the 43-year-old Arnault had control over France’s largest-public owned company.

Acquisitions and early headwinds

Despite acquiring several successful luxury brands in the early 1990s such as Givenchy, Loewe, Sephora, Thomas Pink, and Kenzo, sales were impacted by the Asian economic crisis.

Since the Asian market was responsible for almost 50% of LVMH’s revenue, the company’s share price experienced a slow but steady decline over the decade.

It did not start to rise until LVMH acquired the Gucci Group in 1999, which kicked off the luxury wars, and eventually, Gucci ended up in the hands of Kering.

kering-business-model — Kering Group follows a multi-brand business model strategy. The central holding helps the brands and Houses part of its portfolio leverage economies of scale while creating synergies. At the same time, those brands are run independently. Kering is today a global luxury brand that made over €20 billion in revenue based on this multi-brand strategy. Within Kering Group are brands like Gucci, Bottega Veneta, Saint Laurent, and many more—the primary operating segments based on luxury and lifestyle.

Today Gucci is a powerhouse, and the most prominent brand within Kering, generating nearly €10.5 billion in revenue!

gucci-revenue — Gucci generated €10.49 billion in revenue in 2022, compared to €9.73 billion in 2021 and €7.44 billion in 2020.

Further acquisitions

In the 2000s, Arnault added more brands such as DKNY, Fendi, Moynat, Loro Piana, Repossi, Jean Patou, Dior, and Stella McCartney.

While LVMH now owns more than 70 different brands, each brand has creative autonomy and its heritage is preserved. Nevertheless, each leans on LVMH’s centralized corporate and financial support as required.

In acquiring so many brands, LVMH has created an oligopolistic luxury fashion market structure that few thought possible a few decades ago.

Parfums Christian Dior

Parfums Christian Dior is the perfumery, makeup, and skincare line of French fashion house Christian Dior SE which was founded in 1946 and is now chaired by Bernard Arnault.

The first product to be released was a women’s perfume, but in more recent times the subsidiary has started selling men’s fragrances and a greater variety of cosmetics. These include foundations, concealers, mascara, brushes, and lipstick.

Dom Pérignon

Dom Pérignon is a vintage champagne brand that was named after the Benedictine monk and cellar master who was a pioneer of blending grapes to improve wine quality.

The quality and pedigree of Dom Pérignon are such that the wine will not be produced in years considered to be poor vintages. LMVH assumed control over the company when it acquired fellow wines and spirits house Moët & Chandon.

Chaumet

Chaumet is a luxury jeweler and watchmaker that was founded in 1780 by Marie-Étienne Nitot. With over 240 years of craftsmanship experience and an impressive list of clientele, the company has seen expansion into Asia with a particular focus on the Chinese market.

LVMH acquired Chaumet in 2012.

DFS

One of the less well-known LVMH subsidiaries is luxury product travel retailer DFS.

The company, which was founded in Hong Kong in 1960, operates over 400 duty-free stores across 15 major airports and 18 popular travel destinations.

In addition to high-end products, DFS also sells premium services such as a beauty concierge and exclusive airport lounge access.

Royal Van Lent

Royal Van Lent is a Dutch manufacturer of luxury yachts that was founded as an association of families to revive the industry after World War II.

One of these families was the Van Lent family, who owned a shipyard many years beforehand and consistently produced fast yachts that won speed races.

The company was awarded its royal charter in 2001, with LVMH acquiring it seven years later. Royal Van Lent’s signature Feadship Tango superyacht was released in 2011 and retailed for approximately $120 million.

Key takeaways

LVMH is a French multinational corporation and conglomerate with a focus on luxury goods. At the time of writing, LVMH operates 75 subsidiaries which it calls houses across six core sectors.
Parfums Christian Dior is a men’s and women’s cosmetic company owned by LVMH, while the famous champagne brand Dom Pérignon also came under the company umbrella after it acquired fellow wines and spirits brand Moët & Chandon.
Some lesser-known LVMH subsidiaries include luxury watch and jewelry maker Chaumet, premium duty-free product and service provider DFS, and Dutch yacht manufacturer Royal Van Lent.

What brands are owned by LVMH?

LVMH Group generated €64.2 billion in revenues in 2021, comprising 75 houses and brands like Louis Vuitton, Christian Dior Couture, Fendi, Loro Piana, and many others. The company employed 175,000 people in 2021.

Does LVMH own Gucci?

LVMH does not own Gucci. Rival Kering owns Gucci. In the late 1990s and early 2000s, a war between Prada, Kering, and LVMH ensued to take over Gucci, which eventually would be successfully bought by Kering. In 2021, as part of Kering, Gucci generated €9.73 billion in revenues.

Is Prada owned by LVMH?

LVMH does not own Prada. Prada is still in the hands of Miuccia Prada and Patrizio Bertelli. It’s one of the few fashion brands still in the hand of the family which founded it.