Lvmh Moet Hennessy Vuitton (EU:MC)
Graphique Historique de l'Action
3 Mois : De Juil 2019 à Oct 2019
By Noemie Bisserbe and Saabira Chaudhuri
PARIS-- LVMH Möet Hennessy Louis Vuitton bought a minority stake in the British fashion house set up by Stella McCartney, giving the French luxury company a high-profile vehicle to tap growing demand for high-end clothing marketed as sustainable.
Details of the deal, announced by both companies on Monday, won't be disclosed until September, but LVMH said Ms. McCartney would retain a majority stake in the company and continue as creative director. Ms. McCartney will also become a special adviser to Bernard Arnault, LVMH chairman and chief executive.
According to a person familiar with the matter, LVMH has bought a stake close to 50% in the Stella McCartney House. A spokesman for LVMH didn't respond to a request for comment. A representative for Stella McCartney declined to comment.
Stella McCartney, which has for decades touted its sustainability credentials, doesn't use leather and fur and utilizes stainless-steel and aluminum alternatives to brass for some of its bag chains in an attempt to reduce water pollution caused by copper mining. Last year, the company launched a dedicated microsite devoted to telling consumers about its various sustainability efforts.
The move is an abrupt change of direction for Ms McCartney, who last year bought out partner Kering SA, LVMH's crosstown archrival, taking back control of her eponymous brand. Kering had owned a stake in Stella McCartney since Kering brand Gucci co-founded the house with Ms. McCartney in 2001. Now, she's back in the fold of one of the world's fashion conglomerates.
Luxury companies are seeking to appeal to young shoppers increasingly attuned to sustainability, as well as the ethical treatment of animals -- which for centuries provided key raw materials for the fashion trade.
Ms. McCartney was the "first to put sustainability and ethical issues on the front stage, very early on, and built her House around these issues, " said Mr. Arnault.
Luxury brands have largely lagged behind their mass-market peers on such topics. In 2014, fast-fashion giant Hennes & Mauritz AB launched its first garments made from recycled cotton, while the company also sells products made from recycled polyamide, wool and cashmere.
The company in March said it would phase out cashmere products by 2020 out of environmental and animal-welfare concerns. It has committed to 100% of the cotton it uses being sustainable by 2020. Rival Gap Inc. has made the same commitment by 2025.
Meanwhile Zara owner Inditex has said it plans to send no waste to landfills by 2020 and has rolled out an in-store effort to collect clothes hangers and security tags so that they are reused, repaired or recycled. Both H&M and Zara are investing in recycling technologies so that old clothes can be turned into new ones.
Still, a May report from Boston Consulting Group and the nonprofit Global Fashion Agenda criticized the fashion industry for moving too slowly in its sustainability efforts. It said unless the current trend improves, the fashion industry would continue to be a net contributor to climate change. The report cited more than a third of surveyed consumers as saying they switched from their preferred brand to another for reasons related social and environmental responsibility.
Write to Noemie Bisserbe at firstname.lastname@example.org and Saabira Chaudhuri at email@example.com
(END) Dow Jones Newswires
July 15, 2019 17:22 ET (21:22 GMT)
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