French billionaire Bernard Arnault has secured control of the luxury goods group LVMH for the next three decades. The move, originally scheduled to take place at the time of his death, has now been triggered by the turn of 25 of his youngest child, Jean Arnault, reports Italian newspaper Sole 24 Ore. Control is not transferred to a Belgian foundation, but to the limited partnership Financière Agache.
The structure of the limited partnership has both general partners with administrative powers and limited partners with economic rights. In this case, Ludovic and Stéphanie Watine, the children of Bernard’s late sister, have priority over the economic matters. However, ultimate control rests with the managing partner, Agache Commandité.
Bernard Arnault’s five children own Agache Commandité’s capital equally and are not allowed to sell shares for 30 years to ensure long-term family control. Bernard Arnault, 74 years old, will remain managing director of the company with unlimited powers until he turns 95.
Luxury brands and corporations founded by a family often retain family members in leadership positions because of their commitment to the company’s long-term success and legacy, providing stability, a shared vision, trust and control. Your emotional connection to the company’s history and values can help maintain stability and continuity. Although it is sometimes difficult for outsiders to advance into leadership positions, it is essential for companies to integrate professional management to gain new perspectives and expertise.
This translated post previously appeared on FashionUnited.com