The executive committee also noted that regardless of the corporate structure adopted, the foundation shall never hold less than 30 per cent of the capital, as per the will. The foundation’s first duty will be to propose the name of a new CEO.
Why it matters
Armani upheld independence as a cardinal value throughout his career. The fact that the brand may, in the coming years, become part of a bigger group marks the end of an era.
We have had few details on Armani’s succession plan so far. What we knew was that Armani held 99.9 per cent of the shares in the company he built, the remaining 0.01 per cent belonging to the Giorgio Armani Foundation, which he created in 2016. The foundation will run the company, and Leo Dell’Orco and Armani’s niece, Silvana Armani, are among the figures expected to play a key role.
Now, Armani’s will has indicated three preferred partners. “He indicated partners that have a significant size and potential synergies,” says Mario Ortelli, managing director of Ortelli & Co. “These three groups’ sales are north of €26 billion, which means Armani would represent less than 10 per cent of their revenues [in 2024, Armani group revenues were €2.3 billion, down 5 per cent year on year]. LVMH has a decentralised model with its houses, while L’Oréal and EssilorLuxottica aren’t focused on fashion, so they would give Armani a certain autonomy. We see he seeks to build a safety net while keeping a level of autonomy.”
It’s easier to maintain a legacy under the protection of a larger conglomerate that has firepower in terms of investment in retail, marketing and attracting and retaining talent. With LVMH, the biggest synergies would be in supply chain and retail; with L’Oréal and EssilorLuxottica, the synergies lie more in marketing and, to some extent, distribution.
“What we read today makes sense from the Armani viewpoint,” says Bernstein managing director Luca Solca. “LVMH is the largest and most qualified fashion and luxury conglomerate in the world — EssilorLuxottica and L’Oréal are the two most important licensees of Armani. You recently saw, for example, Estee Lauder buying Tom Ford to make sure its beauty business could continue to thrive. L’Oréal and EssilorLuxottica would have convergent interests with the Armani family.”
