Bernard Arnault, the man behind some of the world’s top luxury labels, has been officially named France’s richest man. He came top of Challenges magazine’s annual 500 wealthiest professionals, with an estimated £18.9 billion fortune. Arnault, the founder, chairman, and ceo of LVMH – the large luxury goods conglomerate which includes Louis Vuitton, Dior, and Fendi, knocked last year’s winner Auchan supermarket owner Gérard Mulliez off the top spot. Liliane Bettencourt, one of the principal L’Oreal’s shareholders came third at £14.3 billion. – from Vogue
Arnault was born in Roubaix. After graduating from the Maxence Van Der Meersch High School, Arnault was admitted to the École Polytechnique (X1969) from which he graduated with an engineering degree in 1971. After graduation, Arnault joined his father’s company. In 1976, he convinced his father to liquidate the construction division of the company for 40 million francs, and to change the focus of company to real estate. Using the name Férinel, the new company develops a specialty holiday accommodation. In 1979, he succeeded his father as president of the company.
When François Mitterrand was elected President of France in 1981, Arnault emigrated to the United States and created Ferinel Inc. Through this vehicle, Arnault undertook construction activity in the United States, developing an apartment complex in limited partnership form in West Palm Beach, Florida, which defaulted on its mortgage shortly after its completion. The equity investors lost their entire investment and bondholders who had financed the project lost most of their money as well. He was not particularly successful in the United States. Three years later, when the French Socialists switched to a more conservative economic course, Arnault returned to France and became the CEO of Financière Agache, a luxury goods company. With the help of Antoine Bernheim, managing partner of the Banque Lazard investment firm, and government subsidies conferred in exchange for a promise not to downsize, Arnault acquired Boussac, a textile company in turmoil. The Arnault family put up just $15 million of their own money, with Lazard supplying the rest of the reported $80 million purchase price. Arnault sold nearly all the company’s assets, keeping only the prestigious Christian Dior brand, and Le Bon Marché department store.
In 1987, shortly after the creation of LVMH, Mr Arnault exploited a growing conflict between Alain Chevalier, Moët Hennessy’s CEO, and Henry Recamier, president of Louis Vuitton. The new group held property rights to Dior perfumes, which Arnault craved to incorporate into Dior Couture. He created a holding company of which he owned 60% and Guinness, who had a distribution agreement with Moët-Hennessy, owned 40%. Following the October 1987 stock market crash, he capitalized on the lower quoted price and soon owned 43% of LVMH. He then consolidated his position by purging executives from both companies including appointing his father Jean Leon Arnault Chairman of the Supervisory board before officially taking over as Chairman & CEO in 1989.
In 2007 he acquired 10.69% of France’s Largest Supermarket Retailer and the World’s Second largest Food Distributor Carrefour through his Blue Capital which is jointly owned by California Property Firm Colony Capital.
He has since then led the company through an ambitious development plan, turning it into one of the largest luxury groups in the world, alongside Swiss luxury giant Richemont and French based PPR Group.
Among other companies, Arnault also owned the art auction house, Phillips de Pury & Company from 1999 to 2003.