Luxury in the spotlight with the Armani will, weak Lvmh and Essilux in Paris

(Il Sole 24 Ore Radiocor) - Giorgio Armani's will turns the spotlight on European luxury stocks. The document reveals, surprisingly, the designer's request to vsell 15% of the maison, after twelve months and in any case within eighteen months "from the date of the opening of the succession", and "as a priority" to a group between Lvmh, Essilorluxottica or L'oreal. A decision that effectively excludes investment funds and financiers. Alternatively, the designer's house could go within 3 to 5 years towards a stock market listing, with the Foundation holding 30% of the capital.

For the time being, investors' reactions to the news were timid. On a day of general weakness for the luxury goods sector, the Bernard Arnault-led giant dropped in Paris, while on the CAC 40 Essilux and cosmetics giant L'Oreal were also down. The news for now had a moderate impact also at Piazza Affari (FTSE MIB), where they fell Brunello Cucinelli and Moncler. The declines are sharper for Salvatore Ferragamo, which is grappling with reactions to the dismissal of CFO Pierre La Tour, "a further element of uncertainty for the group that is still searching for a CEO," according to Intermonte.

Returning to Armani, the first hypotheses on the future of the maison are beginning to take shape among the operators, with Essilux letting it be known that it will evaluate in the board of directors the possible entry into the company, a dossier that "deserves careful consideration". In his will, Giorgio Armani has specified that the 15% stake, in agreement with Pantaleo Dell'Orco (the designer's lifelong companion who now holds 40% of Essilux's voting rights), can also be sold "to other companies or groups", but always "operating in the world of fashion and luxury of equal standing with the groups indicated above and with priority for groups with which the company already has partnerships". This sale is, however, only the initial step: starting from the third year and within the fifth year from the date of the opening of the will, Armani asks his heirs to "sell to the same purchaser of the first 15% of the company's capital, a further share" for a minimum of 30% of the capital and a maximum of 54.9%. With this 'second tranche', the new party could thus achieve an absolute majority in the company.

Should the sale fail, however, there is also a 'plan B'. As an alternative, Armani has ordered 'the listing of the company's shares on an Italian regulated market or one of equal standing'. The listing on the stock market would come, should Dell'Orco and one of his grandchildren, Andrea and Silvana, make a request to the Foundation, within three years of the opening of the will, but 'in any case' within five years or a maximum of eight years. At this point, according to the document, 'an ordered plan for the valorisation of a part of the residual shareholding held by the Foundation in the company, so that the Foundation's shareholding is never less than 30.1%' must be implemented.