4 distributed among approximately 70 heirs

Des marchés financiers (AMF) Authority is becoming a key to the Hermes-LVMH record player. The Constable of the stock market has already launched an investigation to verify that all rules have been met by LVMH, which revealed late October hold 17.1 of the shares of Hermès International. AMF will also have to say yes or no, can the family, as she announced to have intent Sunday evening, put together the bulk of its 73 in a family holding company without launch for all OPA on manufacturer's famous squares of silk. Overview in five questions.

What is the objective of the holding

The control of Hermes is already locked by a sponsorship. It is the anti-OPA (public offer to purchase) weapon par excellence. It allows families to maintain their business while being minority. Its characteristic is to ensure a total dissociation between management and the detention of the capital in the company. Groups such as Michelin and Lagardère already use it. Arnaud Lagardère therefore controls his group with less than 10 of the shares.

After the surprise entry of LVMH (also owner of the "voices"), Hermes will is go further padlock its capital. Today, the family holds a 73.4, distributed among approximately 70 heirs. But no legal relationship not previously between them. The creation of a holding company, "a vocation" to hold more than 50 of the capital of Hermes, designed to secure this control and to ensure the unity of the descendants. It should also organize the liquidity of securities among family members. They could sell their shares without taking the risk that they are purchased by the Bernard Arnault group. The holding company benefit, indeed, of a right of preference, the still undefined terms, on the remaining shares held by the family.

How could operate the holdinG

This non-rated family holding should hold at least 51 of the capital of Hermes. A same family shareholder might decide to provide a portion of its shares, and leave the rest in stock. The heir who would decide to sell should propose priority shares to the holding company. The purchase price should be aligned on the quoted market price, at the time of the operation. The holding company would be funded by a portion of the dividends brought by the family. Remains whether the means will be sufficient. Since the scholarship of the SADDLER in 1993, between 0.5 to 1 of the capital held by the family was transferred on average each year.

Hermes said Sunday, that "the commitment of the family constitute the majority holding is irrevocable." However, there is a legal mortgage: the need to obtain a derogation of the MFA. Some experts believe that this tool "would be discriminatory to outside shareholders to the family", since it would prevent them from mounting a threshold in the capital. But also "to the family shareholders, distorting the game of supply and demand." It would reduce in any case the liquidity, already low, of the title and could harm his recovery.

Should the operation lead to a takeover bid

As a shareholder or a group of shareholders acting together exceed the threshold of 30 of the capital in a listed company, the regulation requires to make a takeover bid. The AMF may nonetheless access requests for exemption, as long as they correspond to one of the seven cases listed in general regulations.

The Hermes heirs do not want to have to launch of OPA on the group, currently valued at nearly 16 billion euros on the stock exchange. The argument that they rely on is the operation of reclassification. This case applies when there is a transfer of securities companies or persons belonging to the same group - in this case the descendants of the founder-, without a change in the control of the company. The question is whether the transfer of a portion of the securities held by the Hermes family in a holding is an action of concert or a simple reclassification. The first option would necessitate the family holding company to launch a takeover bid, the second would exempt it.

What is the case-law of the AMF

The MFA keep well to comment on the project of the Hermès heirs. It insists on the fact that each claim requires a specific review. When the company is controlled by a family, arbitration must take into account the details of the distribution of titles and, especially, the way in which the market was informed about it.

The claims are commonplace. Nothing that in 2009, the MFA in awarded 31. One of the recent decisions in connection with operation of reclassification is Séché environment. The number three French of the treatment of waste had asked the MFA a derogation from the requirement to file an OPA project when the Caisse des dépôts et consignations (CDC) has transferred its interest (20) to the strategic investment Fund (ISP). Having acceded to the Covenant of shareholders which was previously the CDC with Joël Séché, holder of 42.9 of the titles, the AMF found that the operation had "only consequence to substitute ISP for CDC in concert with dried Joël". Where the granting of the derogation, July 24, 2009.

What happens if the AMF is granted a derogation

If the AMF granted a derogation, the family holding company will be not compelled to make a takeover bid. But there will be challenges. Let's start with those already made by Colette Neuville, President of the Association for the defence of minority shareholders (Adam). The latter rejected the argument advanced by the family, and says that the creation of a holding company would amount to an action in concert. Therefore, the operation should compel stakeholders to offer a possibility of output to the minority shareholders, through a takeover bid, she adds.

The President of the Adam plans to file an appeal with the Court of appeal of Paris, in the event of derogation. There are other remedies, including on the part of LVMH.