LVMH Group, the luxury brand group are planning to add to its luxury brands by aquiring Bulgari at a cost of 3.7 billion Euros.

LVMH Group, the luxury brand group are planning to add to its luxury brands by aquiring Bulgari at a cost of 3.7 billion Euros. Bulgari was founded by Sotirio Bulgari in 1884 and has since been recognised as a luxury brand specialising in jewellery, watches and accessories. 

Bernard Arnault the Chief Executive Officer of LVMH has built the LVMH empire by aquiring many other luxury brands and this latest aquisition could see the LVMH Group acquiring the 3rd largest jewellers in the world.

Moet (champagne), Hennesey (cognac), Louis Vuitton (handbags, luggage and accessories), Glenmorangie (Scottish Whiskey), Hermes (luxury goods) and Donna Karan International (DKNY watches, DKNY jewellery, clothes and accessories are just some of the brands already controlled under the LVMH umbrella.

According to a statement by the Italian exchange, LVMH has agreed to buy the 50.4% stake which is owned by the Bulgari family at a price of 1.87 billion Euros and will also make a bid for the rest of the shares.

Data from Bloombergs shows that LVMH will be paying over 26 times the the yearly earnings of Bulgari, whereas the average paid for jewellery retailers over the last 10 years has been less than 9 times.

In January Bulgari released figures for the last three months of 2010 which showed a 21% increase to almost 358 million Euros and the companys full years revenue has increased by 15% to over one billion Euros.