Kering, the French luxury group, has recently announced that it currently has no plans for new acquisitions or mergers. François-Henri Pinault, CEO of Kering, made this statement during the presentation of the company’s 2019 financial results. The announcement comes amidst speculation about a potential merger with Italian sportswear label Moncler. However, Pinault confirmed that there are no ongoing acquisition plans at the moment.

Although Pinault did not mention any specific brands, there have been rumors of meetings between him and the CEOs of Prada and Moncler. These meetings have sparked speculation about potential acquisitions. However, Pinault clarified that these discussions do not necessarily mean that there will be an acquisition in the near future. Moncler’s CEO, Remo Ruffini, also denied any possibility of a merger with Kering.

Pinault emphasized that Kering’s main focus right now is on organic growth. He believes that there is significant potential within the group to expand its existing brands. Pinault highlighted the successes of Balenciaga, the relaunch of Bottega Veneta, the positive results from Boucheron, and the incredible future potential of Gucci. However, Kering is still open to market opportunities. Pinault explained that the company is always willing to add to its brand portfolio but is extremely selective.

Kering is cautious about acquiring brands that directly compete with its existing ones, as this could diminish value instead of creating it. The company assesses potential opportunities based on product categories, pricing segments, and style complementarity. Pinault stressed that brand size is not the deciding factor in their selection process. Kering avoids targeting very small labels since their systems and platforms are tailored to their own brands, which range in size from McQueen’s €500 million to Gucci’s nearly €10 billion.

In addition, Pinault also discussed investments made outside of Kering’s current perimeter through Artemis, his family’s investment firm. He mentioned luxury cruise company La compagnie du Ponant as an example.

However, Pinault expressed disinterest in the watch sector, citing its complexity and lack of growth in the past decade. With only two brands in the watch-making industry, Kering is not inclined to make any acquisitions in that sector.

Overall, Kering’s priority remains growing the brands within its portfolio, as this is the most profitable growth path for the company. While Kering is open to market opportunities, potential acquisitions will be carefully considered based on how well they complement existing brands and align with the company’s strategic goals.

Useful Links:

1. Kering’s Sustainability Initiatives
2. Kering’s Press Releases