David Rosenthal: belief

Transcript context

…I've been wanting to hear the other side of the story. I know. Okay, for anybody who's listened to our LVMH episode, as we talked about earlier, the climax of the story is Bernard's fight with Gucci in that episode. Gucci is the one that gets away, Bernard isn't able to buy it. Right after the Gucci fight ends in the early 2000s, the same story plays out with Hermes. I think really in an even more dramatic fashion, in 2001, right after he lost Gucci, Bernard quietly buys an initial stake in Hermes of 4. 9%. I believe that was just under the threshold that they would have to disclose it under French securities, regulations. Here's what they do that the Hermes families couldn't see coming that only Bernard could engineer. He continues buying for the next 10 years using equity swap derivatives. It looks like other entities are buying these shares on the open markets, but LVMH have the rights to exercise options to actually take those shares. This is really hard to remember. I had to triple check these numbers. At this point in time, Hermes' market cap is below $20 billion. That's 8%-9% of what it is today.…

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