Industry / Retail

Richemont Wants to Keep Ex-Bulgari CEO off Board


Richemont chairman Johann Rupert is asking investors to keep Francesco Trapani (pictured), the former head of LVMH’s watch and jewelry division and CEO of Bulgari, off its board of directors.

Trapani’s name has been proposed to represent “A” shareholders by activist investor Bluebell Capital Partners. Bluebell partner Marco Taricco has told Reuters that it wants Richemont “to focus on what they are good at, which is hard luxury—jewelry and watches.”

Richemont owns celebrated jewelers Cartier and Van Cleef & Arpels, as well as watch brand Jaeger-LeCoultre.

And while Trapani has clear jewelry and watch experience, his connection with LVMH has raised red flags at Richemont.

“Mr. Trapani is not independent, as he has a long history of close relationship with the LVMH group and its main shareholder,” said the letter. “LVMH is one of our company’s key competitors.

“The board may not responsibly recommend to shareholders to let a person who has a long history of association with that group—as well as a personal relationship with that group’s main shareholder—become a director of our company and intervene in our company’s decision-making process.”

Trapani headed Bulgari when it was acquired by LVMH in 2011. He served as CEO and chairman of LVMH’s watches and jewelry division from 2011 through 2014 and on LVMH’s board of directors from 2011 through 2016. He was also an adviser to LVMH chairman Bernard Arnault from 2014 through 2016.

He remained a director of Bulgari until February 2017, when he joined Tiffany’s board the next month—also at the urging of an activist investor, Jana Partners.

Following Tiffany’s sale to LVMH, a Reuters report said that LVMH executives’ “close-knit connections” with Trapani helped “move the deal along swiftly and gave LVMH an advantage in its approach to Tiffany that few rivals could have emulated.”

LVMH first approached Tiffany with its buyout offer one day before its annual meeting—the dates of which are generally kept secret, according to a Tiffany legal filing.

Trapani was eventually recused from discussions about the acquisition and resigned from the board after its announcement.

Trapani did not return a request for comment by the time of publication.

Richemont instead recommended that shareholders elect Wendy Luhabe, who is already serving on the Richemont board, as its “A” shareholder representative.

Photo courtesy of the Italian Business & Investment Initiative

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By: Rob Bates

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