LVMH secretly built a 17 percent stake in Hermès, and 52 family members locked half their shares together to stop it

Hermès was controlled by about 70 descendants of its founder^†. In October 2010 LVMH, run by Bernard Arnault, disclosed that it held about 14 percent of Hermès, built through direct purchases and cash-settled equity swaps that gave it price exposure without triggering disclosure. By late 2010 its stake was about 17 percent and later reached 22.6 percent. Hermès sued to annul the swaps, calling them fraud. In December 2010 chief executive Patrick Thomas and 52 family shareholders set up a holding company, H51, pooling 50.2 percent of Hermès shares, with first refusal on members' shares. In June 2013 France's market regulator, the AMF, fined LVMH €8 million for failing to disclose how it built the stake. LVMH said it would not appeal and that the fine did not challenge its holding. In 2014, under a settlement brokered by the president of the Paris commercial court, LVMH agreed to distribute its Hermès shares to its own shareholders and not to buy Hermès shares for five years^†. The family still controls Hermès in 2026^†.