LVMH to Buy Majority Stake in German Luggage Company RIMOWA for $716 Million -- Update

By Matthew Dalton

PARIS--French luxury-goods firm LVMH Moët Hennessy Louis Vuitton (MC.FR) Tuesday purchased a controlling stake in luggage maker RIMOWA, its first shopping trip across the Rhine to buy a German company.

LVMH said it has agreed to pay 640 million euros ($716 million) for an 80% stake in RIMOWA, which is based in Cologne. It aims to close the acquision in January 2017.

RIMOWA, which makes aluminum and composite suitcases that sell for several hundred euros a piece, is expected to have revenue this year of more than EUR400 million, LVMH said.

The move extends LVMH's strategy of expanding by acquiring high-end brands. After a rare retreat this summer with the sale of Donna Karan International Inc., the French firm appears to be back on the hunt.

RIMOWA would also be the first German brand to join LVMH's stable of companies, said Bernard Arnault, the French billionaire who controls LVMH. The French firm holds dozens of brands, including champagne-maker Don Perignon, and fashion houses Louis Vuitton and Marc Jacobs.

The acquisition marks the second major recent acquisition in the high-end luggage sector, after Samonsite International SA bought Tumi Holdings Inc. in March.

Dieter Morszeck, whose grandfather founded RIMOWA in 1898, will remain as the firm's chief executive and a minority shareholder in the company, LVMH said.

Write to Matthew Dalton at matthew.dalton@wsj.com

(END) Dow Jones Newswires

October 04, 2016 03:38 ET (07:38 GMT)

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