Dutch Court Backs Gucci’s Alliance With Pinault to Thwart LVMH’s Takeover Bid

Italian fashion house Gucci emerged victorious Thursday from a months-long takeover battle after a Dutch court approved a key defense against French rival LVMH Moet Hennessy Louis Vuitton.

In a pivotal ruling in the bitter feud, the Amsterdam court approved Gucci’s sale of a 42% stake to white knight Pinault-Printemps-Redoute, making a takeover by LVMH unlikely.

The verdict allows French distributor Pinault to become with Gucci a third major force in the global luxury goods business to rival LVMH and Switzerland’s Richemont, analysts said.

“Even though the war may not officially be over, it’s increasingly likely that Gucci will be part of [Pinault], and LVMH is stuck with a 20% stake,” one analyst said.

The court rejected LVMH’s demand for a probe of Gucci’s defenses against what Gucci has called a “creeping-takeover” attempt by LVMH, the world’s largest luxury goods group, which sells Dom Perignon champagne and Givenchy perfumes.

Since January, LVMH gradually piled up a 34% stake in Gucci, but that was diluted to 20% after Gucci’s deal with Pinault.

In a minor defeat for Gucci, the court did order the company to dismantle an employee share option scheme, a “poison pill” defensive measure to thwart LVMH’s advances.

“We are very pleased with the decision of the court . . . that upheld the strategic alliance with” Pinault, Gucci Chairman Domenico De Sole told reporters outside the courtroom.

LVMH said it was appealing the ruling.

The issue appeared before a Dutch court because Gucci is legally based in Amsterdam, where its shares are listed.