One afternoon in July, not lengthy after being named the wealthiest man on the planet by Forbes, Bernard Arnault, the pinnacle of the LVMH Moët Hennessy Louis Vuitton luxurious items empire, took his place on a stage with a view of the Eiffel Tower earlier than a packed crowd of French dignitaries and reporters.
Within the entrance row sat 4 of his 5 grownup youngsters — the fifth was watching from New York, the place he’s an govt at Tiffany & Firm. Their father had raised all of them since they might stroll to sooner or later run the LVMH conglomerate.
The event was Mr. Arnault’s announcement that LVMH would supply 150 million euros (about $161 million) to sponsor the 2024 Paris Olympics. LVMH corporations will play a starring function. Chaumet, a Paris jeweler whose shoppers as soon as included Napoleon’s spouse Joséphine, will design the Olympic medals, and Moët Hennessy wines will circulate in hospitality suites.
“The partnership will assist promote France all through the world,” Mr. Arnault declared. As tv cameras zoomed in, his eldest son, Antoine, the pinnacle of communications and picture for LVMH, uttered what could possibly be a tagline for this enormous firm his father has constructed: “For a dream, there is no such thing as a worth.”
It was a second of public triumph for Mr. Arnault, an indication of how embedded within the material of France LVMH has turn into. Over greater than 30 years, he has cast LVMH into the world’s largest luxurious group and probably the most precious firm in France, with a presence in 81 nations. His manufacturers — 75 of them — are the celebrities of the luxurious world, together with Louis Vuitton, Christian Dior, Tiffany and Dom Pérignon Champagne. It has given him entree to prime ministers and presidents, and allowed him to amass a museum-worthy artwork assortment.
However his success has introduced challenges. In France, Mr. Arnault has turn into a lightning rod for anger over rising financial inequality. In April, 10 days after Forbes put him atop its annual record of richest folks, protesters stormed his workplace in Paris throughout nationwide strikes over elevating the retirement age. His effigy was burned as an emblem of capitalist evil.
Mr. Arnault’s 5 youngsters have been taught in France’s finest faculties and raised to take management posts within the enterprise, however his dream of conserving LVMH within the household could pressure him to raise one above the remainder.
And in latest months LVMH’s inventory has taken a beating, down 19 p.c since hitting a excessive in April. The corporate reported a dip in U.S. gross sales within the second quarter, and the Chinese language economic system, a giant supply of LVMH’s income, is faltering.
The falling shares imply that Mr. Arnault (now value about $195 billion, Forbes says) dropped to the second-richest particular person on the planet in June, eclipsed by Elon Musk. This month, LVMH was changed as Europe’s Most worthy firm by Denmark’s Novo Nordisk, the maker Ozempic and Wegovy, the vastly widespread medication getting used for weight reduction.
At 74, Mr. Arnault has been working to ensure his firm — created by gobbling up many European luxurious homes that had been weakened by bickering household house owners — will keep firmly in his household’s arms, protected from company raiders like himself. Final 12 months, he persuaded the board to boost the necessary retirement age for the chief govt and chairman to 80, from 75, and created a company construction that ensures the household’s management of LVMH, locking in his youngsters — every of whom has been named to extremely seen positions throughout the firm — because the chief resolution makers.
Mr. Arnault has broadened LVMH past extravagant playthings into the world of experiences, buying over 50 grand lodges and resorts. And with the Olympics deal, he has prolonged his tentacles extra deeply into the world of sports activities.
Mr. Arnault’s modifications imply he doesn’t need to retire subsequent 12 months as initially anticipated. That hasn’t stopped hypothesis about whether or not he can be certain that his heirs — who gown in nearly an identical Dior navy fits (save for Delphine, his one daughter, who usually wears Dior skirts) — keep away from a “Succession”-like drama.
The French media is stuffed with headlines evaluating the Arnaults to the Roys, the fictional household within the HBO sequence. There are TikTok movies explaining why the Arnaults are “the actual ‘Succession’ household.” The household hates this discuss, and takes pains to minimize parallels to the present.
The eldest sibling is Delphine, 48, chairman and chief govt of Christian Dior Couture and a member of the LVMH govt committee and its board. Antoine, 46, will not be solely in command of the group’s picture and sustainability efforts however chief govt of its males’s put on model Berluti, chairman of the Italian luxurious home Loro Piana, chief govt of Christian Dior S.E. and a member of the LVMH board. Each are from Mr. Arnault’s first marriage, to Anne Dewavrin. The youngest three are from Mr. Arnault’s second marriage, to Hélène Mercier, a Canadian live performance pianist: Alexandre, 31, is govt vice chairman of product and communications at Tiffany; Frédéric, 28, is chief govt of Tag Heuer; and Jean, 24, is Louis Vuitton’s watch director.
In a uncommon interview in LVMH’s discreetly lavish headquarters in Paris — this text is the primary for which Mr. Arnault and his youngsters have agreed to speak on the report to a global newspaper — Mr. Arnault disregarded any comparability to tv’s Roys with a wave of his hand.
“It’s not an obligation, nor inevitable, {that a} child is my successor,” he mentioned, leaning again in a buttery leather-based chair at a spherical desk in his non-public convention room. On one wall was a Picasso; on two others, Warhols. His son Antoine, in his function as picture gatekeeper, sat throughout the desk.
Mr. Arnault was carrying a white shirt, a blue tie, a navy jacket and black slacks, although nowadays he’s often with no tie, Antoine mentioned, a part of a extra informal uniform that has accompanied new efforts to have interaction with the surface world. The kids have been instrumental in pushing their father to be extra open concerning the conglomerate.
“One of the best particular person contained in the household or outdoors the household must be sooner or later my successor,” Mr. Arnault continued. “However it’s not one thing that I hope is a duel for the close to future.”
Nonetheless, legacy is clearly on Mr. Arnault’s thoughts. He grew up in Roubaix, as soon as a booming textile middle in northern France, and watched household industrial dynasties collapse as youngsters or grandchildren took their eyes off the enterprise or squandered inheritances.
“After one or two generations, it broke down as a result of they’d it too straightforward,” he mentioned. It was a mistake he vowed to not make along with his personal youngsters. “I didn’t need them to begin going to large events,” Mr. Arnault mentioned. “I made them work.”
Enterprise on the Eating Desk
Each month, the 5 siblings meet with their father over lunch on the highest ground of LVMH’s headquarters.
For an hour and a half, they talk about enterprise, together with funds, the curve of the bracelet on a brand new €50,000 Vuitton watch, upcoming product introductions and the social media payoff of over-the-top occasions. For instance, a Vuitton males’s put on present by the model’s new designer, Pharrell Williams, shut down Paris’s Pont Neuf and attracted such names as Kim Kardashian and LeBron James, leading to over 16 million YouTube hits.
“Make no mistake,” Jean mentioned. “We talk about issues, however on the finish, it’s he who decides.”
Amid the bonhomie, the siblings say, Mr. Arnault is gauging how every of his youngsters is measuring up.
A graduate of France’s elite École Polytechnique, Mr. Arnault honed his youngsters’s math expertise almost each evening earlier than dinnertime. Antoine recalled that getting something lower than an ideal grade on essential exams “wasn’t acceptable.”
Jean jokes about having “24 years of expertise, as a result of each lunch and dinner was at all times about work.”
Ian Rogers, a former chief digital officer at LVMH, mentioned Alexandre had advised him, “My enterprise training began after I was 9, on the breakfast desk.”
By age 10, Delphine was accompanying her father to Dior shops. He has made weekend inspections of LVMH properties in Paris along with his youngsters a routine for greater than three many years. Alexandre mentioned: “I keep in mind, age 7, pondering, ‘Why is he doing this, and why is he asking the identical query to the identical salesperson, each Saturday of the 12 months?’”
The daddy paired every of his youngsters with a mentor as they entered the enterprise, to show them the manufacturers and monitor their efficiency. Delphine and Antoine began in novice positions (Delphine bought Dior fragrance at age 17) earlier than ascending to the C-suite. The three youngest moved extra rapidly into senior roles, “most likely as a result of he feels time is working out and he wants to hurry up the method of studying,” mentioned Pierre-Yves Roussel, a former chief of the LVMH style group and the present chief govt of Tory Burch.
All of them perceive that the household itself is now as a lot a model because the manufacturers they personal, and have wasted no time making their presence recognized.
In lower than two years at Tiffany, Alexandre helped seal a cope with Beyoncé and Jay-Z, making a social media sensation. (In 2016, Alexandre persuaded his father to amass Rimowa, a German maker of aluminum suitcases, which was based in 1898. He instantly set about making the utilitarian baggage firm cool.) Delphine created the LVMH Prize for Younger Style Designers, a high-profile expertise competitors. And Antoine has thrown huge the beforehand closed doorways of many LVMH corporations with a sequence of “open days” that invite the general public inside factories and workshops.
Their father by no means compelled them to affix LVMH, the youngsters mentioned. Even so, Frédéric mentioned, “he discovered a method to make me wish to give my life to the household enterprise like he did.” (Youngsters from each marriages grew up vacationing collectively, and have been raised to play tennis and piano — their father’s favourite pastimes.)
The clan has gotten larger after two glamorous marriages: Antoine to the mannequin and philanthropist Natalia Vodianova, and Alexandre to Géraldine Guyot, who has an equipment model, Destree, that’s unbiased of LVMH. Delphine’s associate is a digital entrepreneur and billionaire, Xavier Niel.
When Alexandre wed Geraldine in Venice in 2021, friends included Beyoncé, Jay-Z and Roger Federer (who steadily performs tennis with Mr. Arnault). His three brothers have been groomsmen. They share a household group chat, by which they swap child footage.
“I do know it’s disappointing for lots of people,” Antoine mentioned, “however we truly hit it off.”
The iPhone vs. Dom Pérignon
Mr. Arnault was born right into a development firm run by his father and based by his grandfather, who took him to constructing websites when he was 7.
When Mr. Arnault was 28, his father handed him the keys to the enterprise. He refocused it on actual property, and shortly after moved to New Rochelle, N.Y., to increase in an surroundings friendlier to entrepreneurs than socialist France.
It was the period of the company raider, and Mr. Arnault soaked within the extra aggressive strategy to mergers and acquisitions. When he returned to Paris at 35, after a relatively unsuccessful run creating condominiums in Palm Seaside, Fla., he got here again as a barbarian on the gate — and with a brand new concept: A New York cabdriver had advised him that he didn’t know the identify of France’s president, “however I do know Dior!”
Because it occurred, the French authorities needed to unload a bankrupt textile conglomerate that included Dior. Mr. Arnault purchased it for 1 franc, fired 9,000 folks and discarded the whole lot besides Dior, which he then used to assist finance a brutal takeover of LVMH, a bunch lately shaped from the bags maker Louis Vuitton and the Moët Hennessy Champagne and cognac home.
The battle for LVMH made his repute. Enlisted by Henry Racamier, one in all LVMH’s founders, to purchase shares and forestall one other group from gaining management, Mr. Arnault did as he was requested, however didn’t cease. He finally turned the tables, seized management of LVMH and compelled out Mr. Racamier, who mentioned on the time, “We want to discover a modus vivendi, nevertheless it’s onerous with an individual like that.”
His type despatched shock waves by means of the clubby world of French enterprise, the place he turned often known as “the Wolf in Cashmere.” It was the start of a three-decade spree of empire constructing. He pursued family-owned manufacturers recognized for craftsmanship and magnificence: Pucci, Fendi, Celine, Loro Piana. Some have been completely happy to be purchased out; some weren’t. Losses have been uncommon: Gucci and Hermès slipped by means of his fingers after ugly public battles.
Throughout Mr. Arnault’s takeover of Tiffany in 2020, because the pandemic harm earnings, he was accused of enlisting the French authorities’s assist to delay the deal’s closing, and in the long run received a reduction on the negotiated worth. (At $16 billion, it stays the luxurious sector’s largest deal.)
He has expanded LVMH into luxurious hospitality lately. LVMH’s holdings embody the Cipriani resort in Venice, the Orient Categorical prepare and the “21” Membership in New York. There are eating places in flagship shops for Tiffany and Dior, and a brand new four-story Moët cocktail bar in Paris.
Mr. Arnault’s bets have often paid off. Luxurious, in all its kinds, has been probably the most resilient investments on Wall Avenue within the final decade.
“He was at all times saying, ‘The iPhone is nice, however who is aware of if we can be utilizing an iPhone in 10 years?’” Mr. Rogers, the previous chief digital officer, mentioned. “‘Whereas I do know folks will proceed to drink Dom Pérignon.’”
“We’re like Henry Kissinger,” Mr. Arnault mentioned. “We aren’t there to agree or disagree on the political side of the nation by which we’re doing enterprise.”
‘They Must Discover a Kind of Enemy’
Mr. Arnault insisted repeatedly through the interview that his major purpose was not income. “It’s desirability,” he mentioned, “and we should guarantee that in 50 years we’re nonetheless on the prime.”
“Desirability,” mentioned Mr. Roussel, the previous LVMH govt, is the preferred phrase on the firm. However it highlights a possible drawback, he mentioned: “A shopper waking up and saying, ‘You realize, I’m shopping for this product, however there’s somebody making a lot cash out of it.’”
“Is it fascinating that you simply’re shopping for a product from somebody who’s the richest man on the planet?”
That sentiment was not evident this summer season when Mr. Arnault visited China, one in all LVMH’s most profitable markets. The “richest man” headlines from months earlier earned him a rock star’s welcome. In Shanghai and Chengdu, crowds adopted him and vied for selfies. Moms requested him to bless their infants.
“Just like the pope. Are you able to consider that?” he mentioned. He was referred to as, he mentioned with fun, “the God of Fortune.”
However again dwelling, the place ardour about social and monetary inequality stretches again to the French Revolution, Mr. Arnault is a divisive determine: hailed by the enterprise and political worlds for constructing France’s largest company titan, and reviled by others for his nearly unimaginable wealth.
For a household that tries to maintain its fortune discreet, the “richest man” rating this 12 months nonetheless brings an unwelcome highlight.
“The eye that you simply get whenever you’re on the highest of that record,” Antoine mentioned, “you may’t actually put together for that.”
In April, as France’s raucous nationwide protests gathered steam over President Emmanuel Macron’s bid to boost the retirement age two years to 64, demonstrators broke into the LVMH headquarters, lighting smoke bombs and denouncing Mr. Arnault because the embodiment of the ultrarich.
“He’s an emblem of what’s mistaken on this society!” one shouted. Others carried indicators exhibiting Mr. Arnault as Mr. Monopoly in a prime hat, with accusations that he evaded taxes, exploited staff and laid off 1000’s to construct energy and wealth.
This month, when Mr. Arnault introduced that the Arnault household would donate €10 million to Restos du Coeur, a meals financial institution, critics mentioned it was a drop within the bucket.
“They should discover a sort of enemy,” Mr. Arnault mentioned. “France will not be a rustic which is motivated by enterprise success, not like the US.”
When his pal Warren Buffett walks round Manhattan, Mr. Arnault added, “he’s like a Beatle.” However when Mr. Arnault visits his shops in France, “I’ve to watch out,” he mentioned. “I don’t like this, however I would like bodyguards.”
Antoine has suggested his father to push again, and nowadays Mr. Arnault stresses the corporate’s financial contributions: a whole bunch of 1000’s of jobs created worldwide, €5.5 billion paid yearly in French taxes, and huge sums for artwork and tradition, power sustainability, scientific analysis, sports activities and youths.
Who’s Subsequent?
What nobody debates is that Mr. Arnault understood, earlier than nearly anybody else, luxurious’s potential as a generator of revenue — that creating lovely issues is about aspiration and belonging.
The query now’s who can maintain desirability on the coronary heart of LVMH in an age of protests and international financial uncertainty.
Final 12 months, Mr. Arnault tinkered with the company construction of his empire, concentrating decision-making along with his 5 youngsters. Every has a 20 p.c stake, and so they can’t promote their shares for 30 years with out unanimous board approval.
His heirs “have been schooled by the very best participant on the planet: All of them know the enterprise,” mentioned Sidney Toledano, head of the LVMH style group and one in all Mr. Arnault’s longest-serving executives. “Are they going to be the pilots? Possibly.”
If the subsequent chief govt will not be named Arnault, the youngsters say they’re OK with that. In spite of everything, Alexandre mentioned, “there’s the danger that none of us is ready to run the enterprise in addition to he has.”
The siblings are starting to debate how they will increase their very own youngsters with the identical sense of responsibility that was instilled in them, Delphine mentioned. Mr. Arnault has begun taking her elementary-school-age daughter on his weekend rounds of shops.
However Alexandre added: “By the point they attain ages the place they will have tasks, my father will nonetheless most likely be C.E.O. of LVMH. He’ll be 110 years outdated.”
