LVMH Makes Billion-Dollar Bid For ‘Most Elitist Brand In The World’
They might not scream like humans to the tune of Taylor Swift’s “Trouble”, but vicunas do sporadically shed fine wool for the making of four-figure sweaters. This is why LVMH Moet Hennessy Louis Vuitton has forked out $2.56 billion for an 80 percent stake in Loro Piana, a textile firm in Northern Italy that sources the wool of the ruminant family’s latest It Animal.
LVMH communications director Christopher Hollis called Loro Piana “one of the most elitist brands in the world,” reports Bloomberg Businessweek. “I would say Loro Piana is, to a large extent, a sort of well kept secret of the industry, a secret that makes as much as 700 million [euros] in sales, so it’s a nice secret,” adds LVMH Chief Financial Officer and Understater of the Century Jean-Jacques Guiony. We know how they love a nice secret.
Part of the reason the llama-like creature boasts such a valuable coat is that it can only be shorn every two or three years. The wool is one of the obscure materials sourced by Loro Piana and turned into clothing that sometimes borders on five figures. Loro also makes leather jackets ($9,000) and sports coats from the fibers of lotus flowers in Myanmar ($6,000).
The offer represents roughly 23 times Loro’s earnings and four times its annual sales. It will also get LVMH 2,500 skilled workers in Northern Italy, a wholesale business, and 130 stores. Wonder what the tax rates are like in Peruvian shepherding villages?