Armani’s last wishes may sell his fashion empire short
The fashion house is set to kick off a three-way process with LVMH, L’Oréal and EssilorLuxottica for the sale of a minority stake
Successful dealmaking is all about reading the moment and the room. This is particularly hard to do, though, from beyond the grave. That’s a problem for fashion house Armani which, in accordance with the instructions left by its founder, is poised to kick off a three-way process with LVMH, L’Oréal and EssilorLuxottica for the sale of a minority stake.
In principle, Giorgio Armani’s request makes sense. His fashion group is potentially attractive to an outside investor. As one of the first movers in a now crowded space, it boasts strong name recognition and a classic look that appeals to a large audience. And, while one might quibble with the choice of “preferred buyers” — two out of three aren’t even in the fashion business — any one of them would help steady the ship upon its captain’s departure.
Trouble is, this isn’t a good time for Armani — which Lex has in the past calculated could be worth €6.5bn — to sell. The luxury slump has pushed LVMH’s share price down nearly 40 per cent this year and the sector bellwether has been trimming its portfolio, offloading Marc Jacobs earlier this month. Meanwhile, EssilorLuxottica has gone all in on Meta’s smart specs and L’Oréal has recently written a big cheque to Kering, potentially making them even less likely to want to leap into the fray.
Hence the idea currently doing the rounds of the preferred buyers splitting the 15 per cent of Armani on offer three ways. For a few hundred million euro each, EssilorLuxottica and L’Oréal would protect their licences for Armani glasses and beauty respectively, while LVMH, perhaps aided by the judicious use of call options, would stake out its territory for a potential future acquisition.
But while such a patchwork solution might suit the buyers and comply with the founder’s last wishes, it is by no means clear that it would be best for the company. Armani’s revenue declined 2.8 per cent in 2025 and, over time, the group has sprouted a whole host of more-or-less affordable sub-brands. It could do with some vigorous remodelling, which a consortium of heirs and minority investors is unlikely to deliver.
That’s a reminder to entrepreneurs the world over that being a visionary businessman and actually being able to see into the future are two very different things.