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Bernard Arnault becomes world’s second-richest man

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how did he make his billions?

 

Louis Vuitton (LVMH) boss Bernard Arnault, 70, overtook Bill Gates to become the second richest person in the world, the Bloomberg Billionaires Index announced Wednesday—and he did it in style.

The French businessman, who is the force behind many of the biggest names in luxury, pushed to the second spot after a stellar year for LVMH, which saw company shares rise 43%. His net worth is now estimated at $107.6 billion—an increase of $39.1 billion in a single year.

This remains way short of Amazon founder Jeff Bezos’ $124 billion fortune. Yet Europe’s richest person—whose fortune is estimated to be equivalent to 3% of France’s GDP—is one of only three members in the ultra-exclusive centibillionaire’s club.

But just who is Bernard Arnault? And how did he make his fortune? More importantly, how does he manage to spend all that cash?

A fateful taxi ride

After studying engineering at the prestigious Ecole Polytechnique in Paris and graduating in 1971, Arnault joined his family’s construction company, Ferret-Savinel, as an engineer. Yet it was a chance meeting in New York that proved to have a far more dramatic impact.

Sitting in a yellow cab, Arnault asked the driver what he knew of France. “He could not name the president but he knew Dior,” Arnault recently told the Financial Times.

From there, Arnault’s course was set: within three years—and by the age of 30—he’d reinvented Ferret-Savinel as a real estate firm called Férinel, and replaced his father as company president. And in 1984, he embarked on an even more drastic venture. After lobbying the French government, he left Férinel and took up the reins of faltering textile company, Boussac—whose portfolio included the house of Dior—and systematically turned the company into the launchpad for his luxury empire. The purchase price? One Franc.

A luxury shopping spree

In 1987, Arnault was asked to mediate in the rancorous merger of Möet Hennessy and Louis Vuitton, largely because LV held the rights to Dior perfume and Henry Racamier, the 77-year-old chairman of LV, saw him as an ally, according to a report from the New York Times.

Arnault had other plans, however, and instead sided with Moet Hennessy boss, Alain Chevalier, and bought 27% of LVMH in combination with Guinness. This grew to 37% in 1988 and by 1989 Arnault was the biggest shareholder. A year later Racamier resigned from his own family firm and Arnault become both chairman and CEO of LVMH.

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It was part of a rapid expansion that saw Arnault snap up luxury firms including Céline (1988), Berluti (1993), Guerlain (1994), Marc Jacobs (1997), Thomas Pink (1999), Fendi (2001), and DKNY (2001).

LVMH itself now comprises 75 ‘houses,’ including Dom Pérignon, Bulgari, Givenchy, and TAG Heuer. Alongside the 23-story LVMH Tower on New York’s 57th Street, the company owns the Cheval Blanc ski resort in Courchevel, the Hotel Cipriani in Venice (site of George Clooney’s 2016 wedding), the Orient Express, and luxury resorts in the Caribbean, Maldives, St. Tropez, and Paris.

In 1999, Arnault also invested in a small but enterprising DVD rental firm. It’s name? Netflix.

A bet pays off

Arnault was one of the first overseas businessmen to take the gamble of investing in China at the start of Deng Xiaoping’s market-economy reforms, opening a Louis Vuitton store in Beijing in 1992.

The risk has massively paid off over the years. In the first quarter of this year, for instance, LVMH reported a revenue increase of 16% to $14.10 billion, largely fueled by Chinese buyers, who account for over a third of the luxury sector’s sales.

“With the Chinese, the business is really moving from strength to strength,” Financial Director Jean-Jacques Guiony told reporters in April.

Going after Gucci

Like all business leaders, Arnault has suffered his fair share of failures along the way. Most notably, his 1999 attempt to takeover Gucci—described as “the bloodiest fight in fashion” by the New York Post—which resulted in litigation that Arnault ultimately lost. To his chagrin, the fashion house fell into the arms of arch-rival François Pinault for $2.92 billion.

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In 2014, Arnault also admitted defeat in a four-year attempt to purchase luxury scarf-maker Hermès, after then-Hermès Chief Executive Patrick Thomas launched court proceedings to prevent LVMH from mounting a takeover. Arnault eventually agreed to relinquish his 23% stake in Hermès as a result.

Elsewhere, Arnault has unsuccessfully challenged the dominance of luxury auction houses Christie’s and Sotheby’s by buying British auctioneers Phillips in 1999 and got his fingers badly burnt with online retailer Boo.com, which went into liquidation in 2000.

Rising to second place

An April 10 release detailing first-quarter trading for LVMH, stated that, “All geographic regions are experiencing good growth.

“This includes a 20% increase in sales of fashion & leather goods, a 13 % rise in sales of wines & spirits and a 12 % increase in sales of perfumes & cosmetics. Overall, LMVH showed first-quarter growth of 16% and organic growth of 11% compared to 2018. Its overall revenue was around $14.3 billion.

These better-than-expected results have led to a 27% rise in LVMH shares since January 29, when the group announced record sales for 2018.

Arnault is not resting on his laurels, either. On April 17, LVMH announced the completion of its $3.2 billion deal for Belmond, making them part-owners or managers of 45 luxury hotel, restaurant, train, and river cruise properties.

Rihanna and Stella

On May 10, they followed this up with the creation of the new Fenty fashion line, centered around Barbadian pop star Rihanna.

“Designing a line like this with LVMH is an incredibly special moment for us,” Rihanna said in a release. “Mr. Arnault has given me a unique opportunity to develop a fashion house in the luxury sector, with no artistic limits. I couldn’t imagine a better partner both creatively and business-wise.”

More recently, LVMH announced a partnership with Stella McCartney’s name sake brand, which was publicly owned by rival company Kering until last year. The pair did not disclose the terms of the deal, but said it will allow McCartney to continue as creative director and majority owner of the brand.

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“The chance to realize and accelerate the full potential of the brand alongside Mr. Arnault and as part of the LVMH family, while still holding the majority ownership in the business, was an opportunity that hugely excited me,” McCartney said in a release.

“It is the beginning of a beautiful story together, and we are convinced of the great long-term potential of her House,” said Arnault, before stressing that McCartney’s ethical principles were “a decisive factor”.

With the fashion world increasingly drawing criticism for its environmenal footprint, McCartney’s brand is clearly one that Arnault and LVMH can draw from.

“She was the first to put sustainability and ethical issues on the front stage, very early on, and built her House around these issues,” Arnault added about McCartney. “LVMH was the first large company in France to create a sustainability department, more than 25 years ago, and Stella will help us further increase awareness on these important topics.”

 

 

Source : Fortune

 

 

 

 

 

 

 

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Your Commitment Reignites Hope – Oyo Rep, Oseni Hails Tinubu at 72

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Oyo state House of Representatives member, Engr. Aderemi Oseni has added his voice to the chorus of well-wishers celebrating the 72nd birthday of President Bola Ahmed Tinubu.

Oseni, who represents Ibarapa East/Ido Federal constituency, in a statement on Friday by his media aide, Idowu Ayodele, in Ibadan, the Oyo state capital, extolled President Tinubu as a committed and visionary leader, whose unwavering dedication has reignited hope among Nigerians.

The Chairman, House of Representatives Committee on Federal Road Maintenance Agency (FERMA), lauded Tinubu’s doggedness, leadership acumen, and courageous approach to governance.

He emphasised the pivotal role played by the President in charting a course for national development and fostering unity across diverse ethnic groups in Nigeria.

Reflecting on President Tinubu’s illustrious political career, Oseni highlighted the transformative policies and initiatives spearheaded by the celebrated leader, which have significantly impacted the socio-economic landscape of Nigeria.

“Undoubtedly, your track record speaks volumes about your commitment and visionary leadership. Your unwavering dedication has rekindled hope among Nigerians, positioning you as a pivotal figure in charting the path for national development and fostering unity among diverse ethnic groups.

“Your transformative policies and initiatives are already making a significant impact on the socio-economic landscape of our beloved country”, the statement partly read.

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The APC chieftain applauded President Tinubu’s resilience in the face of challenges, expressing confidence in his ability to steer the nation toward greater prosperity.

As Nigeria confronts multifaceted challenges, Oseni urged Nigerians to rally behind President Tinubu’s vision for a brighter future, underscoring the importance of unity, peace, and collective effort in realising the nation’s development aspirations.

The lawmaker added, “I comprehend that as a nation, we confront various challenges, and President Tinubu is confronting these issues directly for the betterment of all. This period, too, shall pass; hence, in such times, let us unite in support of the President and uplift our leaders in prayer.

“Together, we can realise the vision of renewed hope and leave behind a more prosperous Nigeria for the generations to come.”

 

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Kidnappers Must Be Treated As Terrorists – Tinubu Declares

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In a stern address at a Ramadan dinner with members of the Federal judiciary, President Bola Tinubu declared that individuals involved in despicable crimes such as kidnapping must be treated as terrorists.

The President, speaking passionately, reiterated the government’s unwavering commitment to defeating banditry, labeling those who engage in kidnapping as cowards incapable of confronting the might of the Nigerian Armed Forces.

“We must treat kidnappers as terrorists,” President Tinubu asserted, as reported by his spokesman, Ajuri Ngelale. “They are cowardly. They have been degraded. They look for soft targets. They go to schools and kidnap children and cause disaffection. We must treat them equally as terrorists in order to get rid of them, and I promise you we will get rid of them.”

The President made these remarks during the dinner attended by serving and retired judicial officers, including notable figures such as former Chief Justices of Nigeria, Justice Mahmud Mohammed, and Justice Walter Onnoghen.

The event provided a platform for discussions on various issues, including the escalating security challenges faced by Nigeria, particularly in the North-West and North-East geopolitical zones.

Nigeria has grappled with terrorism, banditry, kidnapping, and oil theft, with the aforementioned regions experiencing a surge in insurgent and bandit attacks over the last decade.

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President Tinubu’s government has remained steadfast in its stance of not negotiating with bandits, despite the continued abduction of schoolchildren and residents for ransom.

The recent mass abduction of 137 schoolchildren from Kuriga in Kaduna State serves as a stark reminder of the ongoing security threats.

The President also addressed the need for judicial reforms and improved welfare for judicial officers.

Recognising the challenges faced by the judiciary, President Tinubu pledged to implement necessary reforms to enhance the welfare and working conditions of judicial officers. He emphasised the importance of fair compensation and support for the judiciary, acknowledging their pivotal role in upholding the respectability of the judicial arm of government.

In response, Chief Justice of Nigeria, Justice Olukayode Ariwoola, commended President Tinubu for his commitment to judicial reforms and for hosting the Ramadan dinner in honour of judicial officers.

The Attorney-General of the Federation and Minister of Justice, Lateef Fagbemi, also expressed gratitude to the President for forwarding the executive bill aimed at addressing the stagnant state of judges’ salaries and allowances since 2007.

President Tinubu’s declaration underscores the government’s resolve to combat insecurity and hold perpetrators of heinous crimes accountable.

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Abiodun Unveils 50% Discount Rice Scheme to Aid Ogun Residents

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Governor Dapo Abiodun of Ogun State has said that his administration will commence the sale of rice at half the market price across the state to alleviate the prevailing economic challenges in the country..

Addressing attendees at a special Iftar organised for the League of Imams and Alfas in Abeokuta, Governor Abiodun emphasised the importance of alleviating the economic burden on the public, particularly civil servants.

He stated, “We have decided to commence the sale of rice. We will be selling it at the rate of 50% of the actual price.”

Highlighting the significance of restoring the purchasing power of public servants, the governor affirmed that the initiative aims to counter the impact of inflation.

He asserted, “What we are trying to do is put them in the position they were before the inflation.”

The governor disclosed the establishment of a committee to oversee the distribution of rice to residents, ensuring transparency and accessibility.

He emphasised the sustainability of the programme, stating, “If we sell at the price it was sold before it becomes expensive, it will allow us to use the money to buy more and continue to sell.”

Also, the governor pledged free rice distribution to the less privileged segments of society, including the poor, elderly, and vulnerable individuals.

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Encouraging Muslims to uphold virtuous behavior beyond the fasting period, Governor Abiodun urged continuous prayers for the well-being of the state and the nation.

He reiterated his commitment to constructing a modern secretariat for the League of Imams and Alfas, promising a landmark facility that would set a standard for other states.

In recognition of his efforts towards peace and empowerment, Governor Abiodun was honoured with the title of Ambassador of Peace in Islam during the event.

Attendees also offered special prayers for the upcoming 72nd birthday celebration of President Bola Tinubu, scheduled for March 29th.

Imam Tajudeen Adewunmi, the Secretary of the League of Imams and Alfas, commended Governor Abiodun for his dedication to empowering Muslim youths and fostering goodwill within the community.

 

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