French luxury company Kering, which owns brands such as Balenciaga, Alexander McQueen and Yves Saint Laurent, this week underwent a sweeping reshuffle at the top level, including the departure of long-time Gucci chief executive Marco Bizzari. announced, surprising the fashion industry. , Kering’s finest brand.
The move comes amid continued weakness in sales and stock prices. But the conglomerate, run by billionaire François-Henri Pinault, has also come under pressure from London activist hedge fund Bluebell Capital Partners, which has previous ties to the luxury giant. A person familiar with the matter spoke on condition of anonymity.
Kering declined to comment.
In recent years, activists have turned against the luxury goods industry. Dan Loeb’s Third Point and Artisan Partners called on Richemont, the owner of jewelry brands such as Cartier and Van Cleef & Arpels, to make a change. But the most active of these days are bluebells. Bluebell is a four-year-old, $250 million company. aimed at richemont, fashion brand Hugo Boss. (Bluebell also asked BlackRock and GlaxoSmithKline to change.)
Bluebell failed to convince Richemont shareholders to add former Bvlgari chief executive Francesco Trapani to its board, but the conglomerate agreed to give more leverage to public investors.
Bluebell has ambitious targets for Kering. The hedge fund wants many changes from the conglomerate and Gucci, but is also proposing a merger with Richemont, said people familiar with the discussions.
But reaching an agreement will not be easy. Richemont founder Johann Rupert said in May: I wasn’t interested in the merger. — and two years ago rejected such an offer. And Mr. Pinault may not be interested either. Moreover, both high-end companies are controlled by the founding families, making it nearly impossible for outside investors to win corporate elections.
Bluebell hopes reluctant shareholders will join its push.Kering’s shares have been overtaken by rivals such as Hermès and LVMH over the past year, but sales have rose by just 1 percent, increased to €5.08 billion ($5.58 billion at the time) in the first quarter. But Kering shares rose more than 7% on Wednesday. Bloomberg first reported About Bluebell’s efforts.