Hermès Survives LVMH's Acquisition Attempt: A Story of Tradition and Prestige
Hermès is more than just a luxury brand. Founded in France over 183 years ago, it has become a symbol of refinement and craftsmanship. In 2010, the brand faced a major crisis when the world's largest luxury conglomerate, LVMH, attempted a takeover. How did Hermès defend its independence and remain a dominant force in the luxury market?
LVMH's Acquisition Attempt and Hermès' Response
In 2010, Hermès CEO Patrick Thomas received a call from Bernard Arnault, chairman of LVMH. Arnault revealed that LVMH had already acquired a 17% stake in Hermès and was planning a takeover. Hermès, valuing tradition and family management, did not welcome the move and criticized LVMH’s secretive stock purchases as “ungentlemanly.”
In response, the Hermès family consolidated 50.1% of shares into a holding company to protect the brand. Sixth-generation family member Axel Dumas took over as CEO, marking a return to family leadership.
Defending Tradition in the Luxury World
Hermès holds more than brand value—it protects family honor. During the phone call, the CEO famously told Arnault, “If you want to seduce a beautiful woman, you don’t pounce on her.” This metaphor reflected Hermès’ disdain for LVMH’s aggressive approach.
Hermès maintains a minimal marketing strategy and does not rely on celebrity endorsements. Yet, celebrities around the world voluntarily purchase and promote Hermès products.
Successful Defense and Continued Growth
In 2017, LVMH gave up its acquisition plans and sold its Hermès shares. Hermès emerged stronger, further cementing its position in the luxury market.
Today, Hermès is the second most valuable luxury company after LVMH, offering a wide range of products from handbags and scarves to watches. The Birkin and Kelly bags have become global icons.
A Brand Loved by Global VIPs
Hermès has an elite clientele. Pop star Victoria Beckham owns over 100 Hermès bags, and Jennifer Lopez is known to carry a Kelly bag worth over $100,000. In Korea, Dr. Oh Eun-young is a well-known Hermès VIP, and Birkin bags are also popular among male celebrities.
Adapting Without Losing Its Soul
Founded in 1837 making horse harnesses, Hermès pivoted to travel goods as cars replaced carriages. It maintained craftsmanship traditions like saddle stitching, using two needles to sew by hand. In 1984, CEO Jean-Louis Dumas designed the Birkin bag after a conversation with singer Jane Birkin. The result was explosive growth, multiplying sales by over 30 times.
Family Management: The Backbone of Hermès
Hermès has remained a family-run company for 183 years. Current CEO Axel Dumas is a sixth-generation descendant. The family agreed through a shareholder pact that only family members may hold voting shares, preserving the brand's philosophy.
Hermès treats its employees like family—70% of them are shareholders, further reinforcing loyalty and commitment to quality.
The True Value of Luxury
Hermès is not just about high prices. It’s about tradition, craftsmanship, family leadership, and independence. These values make it a truly timeless luxury brand. As the world evolves, Hermès continues to honor the past while embracing the future.
