Bernault Arnault’s LVMH to take over Christian Dior for $13bn

French business magnate, art collector and billionaire Bernault Arnault has moved to consolidate the corporate structure of Christian Dior, bringing all of the Paris-based fashion house’s operations together under the LVMH luxury umbrella. As it stands, Christian Dior is split between LVMH and other minority shareholders.

LVMH is publically traded, but the Arnault family currently owns a 47 percent stake in the brand. The group has owned a large chunk of Christian Dior’s operations since the 1960s, when it forged a deal to raise capital for the fashion house. However, the brand’s couture business – comprising handbags, made-to-measure gowns and men’s and women’s ready-to-wear fashions – has for decades been split from LVMH’s arm of the business.

LVMH has owned a large chunk of Christian Dior’s operations since the 1960s, but Dior’s couture business has for decades been split from LVMH’s operations

The purchase will be completed in a number of payments that have been planned to simplify leadership of the fashion house. The cash-and-shares deal values Christian Dior at €260 ($283) a share, giving the deal a total value of €12.1bn ($13bn). The purchase price marks a 15 percent premium above the stock’s closing price on April 24.

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The merger is expected to be immediately accretive to LVMH earnings per share. Stephen Mitchell, Head of Strategy for Global Equities at Jupiter Asset Management, said in a Bloomberg Radio

LVMH shares rose by 3.2 percent in early trading in Paris as markets reacted to the news.