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LVMH increases stake in Tod’s as “friendly support”

By Angela Gonzalez-Rodriguez

23 Apr 2021


Tod's, Official Website

The world’s largest luxury group has reinforced a “twenty-five years friendship” through a raised stake at Italian shoemaker Tod’s. LVMH’s shareholding in Tod’s will go from 3.2 percent to 10 percent.

On Thursday, Tod’s said in a statement that LVMH would buy a 6.8 percent stake from Tod’s founder and Chairman Diego Della Valle. LVMH, led by French billionaire Bernard Arnault, already owned a 3.2 percent stake in Tod’s. Once the transaction takes place on April, 28, Della Valle will own, directly and indirectly, 63.64 percent of Tod’s outstanding shares and LVMH will own 10 percent. The namesake investment vehicle of Diego Della Valle, has entered into a sale and purchase agreement with Delphine S.A.S., a fully owned subsidiary of LVMH, for the sale of 2.25 million shares of Tod’s SpA (6.8 percent of the capital.)

The price per share is calculated at 33.10 euros, the average price of Tod’s shares over the 15 trading days preceding the signing, for a total of 74.5 million euros, highlight analysts cited by Yahoo Finance. The price agreed for LVMH’s stake purchase factors in a 10 percent discount to Tod’s share price (the shoemaker’s stock closed at 35.3 euros on Thursday.)

LVMH won’t raise its stake in Tod’s further

A source close to the matter quoted by Reuters said the French luxury group does not expect to raise its stake further for the time being. It’s worth recalling that Diego Della Valle has been a member of LVMH’s board of directors since 2002.

“Through this transaction, the twenty-year friendship between the Arnault and Della Valle families is reinforced”, Tod’s said in its statement.“The friendship with Diego Della Valle and his family goes back over 20 years, a relationship cemented by common human and professional values,” echoed LVMH chairman and CEO Bernard Arnault in a statement following Tod’s announcement. “We are very happy to reinforce further this partnership.”

Likewise, Della Valle said to be “delighted” with the deal, reminding that he and his family “share the values of luxury, quality and products appeal” with the Arnault. “This may represent an excellent reason to consider further opportunities to be taken in the future ahead,” he added, not sharing any clarification. In this regard, Jefferies analyst Flavio Cereda said in a research note late on Thursday there could be speculation of a further LVMH stake increase in Tod’s.

Image: Tod’s, Official Web