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Message: <blockquote data-quote="Anon08" data-source="post: 69274">Okay, so I am not exactly the archetypal fashionista - so, I'll refrain from talking too much about the fashion itself!I think this article prompts some thought about LVMH's plan and general business model. LVMH has appeared to come out of the gates storming regarding the pandemic - first, it bagged a $400m discount on Tiffany, second, it snapped up half of Jay-Z's Ace of Spades, and now, third, it secures Birkenstock. This is surprisingly aggressive expansion, considering the backdrop of the pandemic.I personally would have thought that luxury goods' sales would have been down throughout this period - individuals being made redundant, pay cuts in the form of furlough, and so on. All of this, for me, would point to a large slump in the luxury goods industry. However, I recognise that firms might be planning for the future, and so their behaviour is that of what one might expect 6-18 months in the future. Additionally, firms, especially PE houses, can make good use of the current economic environment to fund acquisitions - low-interest rates/cheap leverage, and anxious targets are prime conditions for those with the cash to splash.What is also interesting is the slightly bizarre areas of investment - a celebrity champagne brand...and sandles (I know I said I wouldn't talk about the fashion, but I can't help it!). I can understand the acquisition of Jay-Z's champagne business - that makes sense given LVMH's portfolio, and I know enough about the world to recognise that the Ace of Spades champagne is highly coveted by some.However, Birkenstock appears to be slightly outside of what LVMH is known for - the sandles aren't particularly flashy, and are (apparently) well-known for their comfort. I recognise that Vogue has praised these sandles and they are seen as fashionable, but again, I would say it doesn't really fit well alongside LVMH's Fendi, Louis Vuitton, and so on. This is perhaps why it has been acquired by L Catterton, rather than LVMH directly. I suspect Birkenstock won't be integrated into the LVMH family and become Louis Vuitton-ised - rather I think L Catterton will restructure the business and attempt to capitalise off a post-pandemic, holidaying world to make the business into a money-printer. At which point, maybe they will hold onto it, maybe it'll be sold on - who knows.</blockquote>

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