LVMH founder’s controlling stake held in Belgium

Bernard Arnault, France’s wealthiest man, shifted part of the family holding through which he controls luxury giant LVMH to a holding company based in Belgium, a source close to LVMH said, confirming a newspaper report yesterday. Arnault, the founder and chief executive of LVMH, transferred a 31% stake in Groupe Arnault to Pilinvest in December 2011, according to Libération. He also transferred the voting rights attached to 48.5% of the equity of the holding to Pilinvest, Liberation said. Arnault had already donated the 48.5% stake in Groupe Arnault without voting rights to his five children. The source did not confirm the size of the transfers. LVMH declined to comment on the report. Arnault has been seeking Belgian citizenship, a move an LVMH spokesman said last week was aimed at protecting a foundation he created to maintain the unity of his family’s holding in the event of his death. According to the statutes of the foundation, which is to run until 2023, administrators must be at least 50 years old, which would prevent Arnault’s five children from sitting on its board and selling their stakes or part of the group or their assets. The holdings of Arnault and his children would be automatically transferred to the foundation if Arnault were to die before 2023. The children would then receive only dividends. Arnault’s demand for Belgian nationality anticipates a European law coming into effect in August 2015, which would allow him to apply the inheritance law of the country whose passport he carries, Dekeysers & Associates lawyer Gregory Homans said. Such a move would protect Arnault’s holding from attempts to contest his will by his children under French law upon his death.

(Reuters)