Jump to full article: Financial Times (uk), 2008-08-08
Author: Haig Simonian in Zurich
Intro: Richemont, best known for its Cartier jewellery and Montblanc pens, on Friday unveiled its long awaited restructuring into a pure luxury goods group by distributing its 19.4 per cent stake in British American Tobacco to shareholders.
The move, long sought by analysts, will involve the distribution of 90 per cent of its BAT holding to Richemont shareholders. The remaining 10 per cent will go to a new Luxembourg investment vehicle called Reinet. . . .
However, action has been deferred in the past by the argument that the tobacco holding provided stability against the more volatile luxury goods business, especially in an earlier period when Richemont was less broadly based in the luxury goods sector and more vulnerable to market and currency swings.
Richemont’s interest in BAT traces back to its origin. Anton Rupert founded Rothmans in South Africa during the 1940s. This ultimately became Remgro and its international operations were spun out in 1988 to form Richemont, dual-listed in Luxembourg and Switzerland, with a third of the equity now held in South African depositary receipts. Rupert family control is retained via special voting shares.
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