;
Image: Stella McCartney

In a development that is being called a “plot twist the luxury war” that is LVMH Moët Hennessy Louis Vuitton v. Kering, Stella McCartney has entered into an “agreement” with LVMH just months after severing her nearly 20-year venture with fellow luxury goods conglomerate Kering. On Monday, LVMH and McCartney, who is the daughter of Beatles front man Paul McCartney, confirmed the deal, which will “accelerate the [18-year old brand’s] worldwide development” of the company, one that is largely known for its commitment to ban leather or fur from all of its wares.

McCartney, who launched her London based label in 2001 in partnership with Kering after she left her position as creative director of French brand Chloe, bought out the 50 percent stake held by Kering – the Paris-based conglomerate that owns fashion brands like Gucci, Saint Laurent, Balenciaga, and Alexander McQueen, among others – in March, saying that “developing a stand-alone business was an opportunity she couldn’t turn down.”

While the financial terms of McCartney buying back half of her brand from Kering were not disclosed, it was widely reported that McCartney “had a long-standing clause in her contract giving her the option to re-purchase Kering’s stake, exercisable by March 31 of this year.”

Fast forward just four months and McCartney has partnered with LVMH. She will “continue [to serve as the] creative director and ambassador for her brand while holding majority ownership,” according to LVMH. The group’s chairman Bernard Arnault said in a statement on Monday, “I am extremely happy with this partnership with Stella. It is the beginning of a beautiful story together, and we are convinced of the great long-term potential of her (company).”

According to a statement from LVMH and Stella McCartney, “The new partners will detail the full scope of this deal in September.”

“The deal is unlikely to have a major effect on LVMH’s balance sheet but it underscores how important values like gender equity and sustainability have become to brands,” according to the New York Times’ Elizabeth Paton. However, “Ms. McCartney’s addition to the LVMH stable gives it yet another female-run house, making it a leader in an industry historically dominated by male designers.”

This is hardly the first LVMH v. Kering quest, as the two luxury powerhouses have squabbled over brands in the past, with the most famous being Gucci, Kering’s crown jewel.

Beginning in the late 1990’s, LVMH began to quietly amass a significant stake in Gucci in furtherance of what the Gucci Group saw as a budding attempt at a hostile takeover. By March 1999, LVMH had built up a 34.4 percent stake, which was an unwelcome development for Gucci’s upper management, including CEO Domenico De Sole and then creative director Tom Ford.

By issuing “poison pill” shares – a tactic utilized by companies to prevent or discourage hostile takeovers, usually through the issuance of new preferred shares in order to make shares of the company’s stock look unattractive or less desirable to the acquiring firm, Gucci was able to prevent LVMH from amassing board seats, and ultimately, sold a 42 percent stake – precisely what LVMH was vying for – to Paris-based luxury conglomerate PPR (now Kering) for $3 billion in what has been called “one of the most bitter fights in corporate history.”

UPDATED (July 16, 2019): This article has been updated to remove a reference to the percentage stake in McCartney’s brand that had been sold, as first reported by the AFP.