Billionaire Profile: Bernard Arnault

Multi-billionaire, Bernard Arnault is the primary shareholder, Chairman and Chief Executive Officer of LVMH, Moët Hennessy Louis Vuitton. The billionaire is number four on Forbes’ list of billionaires and is France’s richest man. LVMH has a net worth of $41 billion and got its start with Arnault’s 1983 purchase of the French textile firm, Boussac. The purchase price was more than $15 million. Boussac originally owned the Christian Dior brand that financially flourished under Arnault’s keen business sense.

The reasoning behind the purchase of Boussac was to have control of the Dior brand and firmly establish the company’s presence in the luxury market. Arnault decided to sell the divisions that did not coincide with his vision and used the earnings to purchase 24 percent of the controlling shares of LVMH. After bitterly battling with the executive staff, Arnault laid off some of the managing executives while gaining control of the company. These business decisions allowed him to rebuild the company and its brand. Arnault’s focus was on the new emerging trends of France and bringing that creativity and energy to the luxury marketplace. Throughout the 1990s, LVMH acquired brands like Givency, Sephora, Tag Heur and several wine and spirit labels. The billionaire’s sense of style and business experience gave him clear vision of the organization needed to make the business successful worldwide.

Unfortunately, economically challenging times meant low sales for many LVMH brands but Arnault never lost his focus of selling quality and luxury products. Some difficult decisions made by LVMH’s chief were downsizing brands and stores to keep the company afloat. That said, 2010 was an excellent year for LVMH due, in part, to its handbag and champagne divisions. Revenue was approximately $28 billion and profits were around $23 billion in 2009. Profits for that year were more than $5 billion.

The watch and jewelry divisions of LVMH doubled their revenue growth and the company acquired a controlling stake in the Italian jewelry house, Bulgari. Dom Pérignon and Krug also saw significant profits. LVMH has a 70 percent ownership in Nude Skincare developed by Bono’s wife, Ali Hewson. Additionally, LVMH acquired a 20 percent share in Hermès, purchased in December.

Recognizing his need for patience, Arnault understands its virtues as it relates to the world of business. Patience is the key to waiting for the right thing to come along, according to Arnault. He said he learned the most from practicing the art of patience.