Bluebell Capital invests in Kering, a strong signal facing LVMH?

Bluebell Capital has made a discreet entry into Kering's capital, as reported by Bloomberg, raising questions about potential transformations in the industry. Are we witnessing the birth of a new luxury giant? Could LVMH's hegemony in the sector be threatened? Holding less than 5% of the shares, Bluebell has avoided making an official declaration to the Autorité des Marchés Financiers (French financial regulator). Nevertheless, the impact on the industry is undeniable.

What does this move imply? Kering, currently undergoing changes in its management and production units, has recently adopted more aggressive business strategies. This change appears to signal a desire to accelerate competition, especially with its main rival, the LVMH group owned by the Arnault family.

Bluebell's involvement with Kering fuels speculation about a potential merger between Kering and Richemont, another luxury giant. Indeed, two years ago, Bluebell acquired a minority stake in Richemont, known for its high-end jewelry brands. If a merger between Kering and Richemont were indeed on the horizon, their combined revenues (20.4 billion euros for Kering and 19.95 billion euros for Richemont) could pose a threat to LVMH's dominant position.

At the helm of LVMH, Bernard Arnault does not seem willing to enter the race for a potential merger with Richemont. In an interview with Figaro Magazine just over a month ago, the French billionaire stated his intention to respect the wishes of Richemont's Chairman, South African Johann Rupert, to remain independent.

Bluebell Capital, a London-based investment fund established in 2019, is no stranger to investing in major publicly traded companies. Bluebell manages around 250 million euros in assets, a relatively modest sum compared to other large investment funds like Elliott Management, which counts its capital in tens of billions of euros. Nevertheless, Bluebell continues its strategy of investing in the capital of large corporations to influence their internal policies.

The Bluebell fund's stake in Kering had the merit of boosting Kering's share price by around 8%, to a value per share of 537.4 euros.