A Brief History of the Dior-LVMH Deal

Last week saw a historic announcement concerning two of the most well-known brands in fashion and luxury — the merger of the Christian Dior brand with LVMH. The $13 billion deal is a restructuring move which has received the unanimous support of board members on both sides. Within the deal, LVMH, which already owned Christian Dior cosmetics and perfumes, will buy Christian Dior Couture.

This merger announcement is the result of years of strategy aimed at putting together a profitable luxury empire, the consolidation of which could have begun as early as 1971.

In 1984, a group of investors, led by Bernard Arnault, took control of the Willot Group and the assets it controlled, which included Dior. Three years later, French multinational conglomerate, LVMH, also known as LVMH Moët Hennessy Louis Vuitton was formed, after fashion house Louis Vuitton merged with Moët Hennessy. The “MH” of “LVMH” came into existence when champagne producer Moët & Chandon merged with cognac manufacturer Hennessy, forming Moët Hennessy in 1971. By 1989, Bernard Arnault had gained control of 43.5% of LVMH, and had taken over the reins of the LVMH group. The production of Dior Haute Couture was spun off into a subsidiary named Christian Dior Couture in 1995.

The latest merger is set to strengthen LVMH’s Fashion & Leather Goods division, as it acquires Christian Dior Couture — an iconic fashion brand. The deal will also bring all of Dior’s brands, from perfume to couture under one roof, providing the much awaited simplification of the corporate structure that existed between Groupe Arnault, Dior, and LVMH.

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