LVMH 2002 Hermès Share Agreement Surfaces in $10B Heir Legal Battle
A newly revealed 2002 document shows LVMH signed an agreement to buy Hermès shares from heir Nicolas Puech's wealth manager, intersecting with a multi-billion-dollar legal dispute over missing shares.
Nicolas Puech, a descendant of the founding family of the French luxury house Hermès, claims that 6% of the company's shares—valued today at approximately $10 billion—mysteriously vanished from his possession. Puech stated that he only realized in 2022 that the shares he held were no longer in his account, prompting ongoing legal battles to determine what happened to them, who sold them, and where the funds went. Now, a newly surfaced document from over two decades ago adds a significant piece to the puzzle.
According to documents leaked and reviewed by Reuters, LVMH signed an agreement in November 2002 aimed at acquiring millions of Hermès shares from Puech and other heirs. LVMH maintains that the agreement was never executed and that it failed to verify whether Puech had genuinely authorized his wealth manager to sell the shares. However, the document gains extraordinary relevance given subsequent events: LVMH covertly built a massive stake in Hermès, peaking at over 23% of the company.
The 2002 Agreement Returns to the Spotlight
The document was signed in November 2002 between Pierre Godé, for years one of Bernard Arnault's closest associates at LVMH, and Eric Freymond, Puech's wealth manager. The agreement centered on acquiring millions of Hermès shares held by Puech and other heirs from the founding family. This detail contradicts certain aspects of LVMH's defense in current legal proceedings. In a court filing submitted in June, the conglomerate argued it never intended to acquire Puech's stake in Hermès, claiming the plan at the time was to persuade him to join a shareholder group capable of influencing the company.
LVMH stated in previous Swiss legal proceedings that the 2002 agreement was never fulfilled. The company argued that questions arose regarding Freymond's authority to act on Puech's behalf, and that it could not confirm the heir's intentions. LVMH also maintained it never instructed Freymond to execute the agreement.
"The agreement stands as a historical trace, yet direct proof linking Puech's missing shares to LVMH's accumulation remains a subject of ongoing judicial scrutiny," legal analysts note.
Millions in Payments to the Wealth Manager
The 2002 agreement was not the only financial connection between the parties. LVMH and the Arnault family holding companies paid Freymond's wealth management firm at least $20 million in fees and payments between 2001 and 2009, during the period he assisted LVMH in accumulating Hermès shares. This relationship eventually spilled into the courtroom. In 2016, Freymond sued LVMH, claiming he received insufficient compensation for his assistance. The dispute ended in 2019 with a settlement requiring LVMH to pay him an additional 10 million euros.
According to documents filed by LVMH in that proceeding, the payments served a strategic purpose: securing Freymond's cooperation and preventing him from helping competitors acquire Hermès shares. As Puech's wealth manager, Freymond had privileged access to family shareholders.
How a Covert Stake Reached 23 Percent
In October 2010, the market received a bombshell announcement when Bernard Arnault revealed that LVMH held approximately 17% of Hermès. For the founding family, this came as a massive shock, threatening their generational control and sparking a bitter multi-year corporate feud. By 2014, LVMH's holdings reached 24.47 million shares, representing 23.18% of the company's capital.
The conflict concluded in September 2014 with an agreement where LVMH agreed to distribute its Hermès shares to its shareholders and pledged, alongside Christian Dior and the Arnault group, not to purchase additional Hermès shares for five years. Financially, the maneuver yielded LVMH an estimated capital gain of 4 billion euros.
The Heirs Quest for Answers
Puech maintains he discovered the loss of his 6% stake only in 2022 after cutting ties with Freymond. Seeking answers and accountability, he launched massive legal proceedings in France, demanding 14 billion euros in damages from various parties, including LVMH and Bernard Arnault. French investigators are probing several figures associated with Freymond, including Swiss attorneys like Alexandre Montavon, though all deny wrongdoing.
While the 2002 agreement does not provide a definitive smoking gun proving those exact shares ended up with LVMH, it reveals that while LVMH was secretly building its stake, it maintained a direct contractual channel with the wealth manager of one of Hermès' largest individual heirs.
