Gucci Group N.V. (NYSE and Amsterdam: GUC) welcomes the decision of the Dutch Supreme Court to remand the case to the Enterprise Chamber of the Amsterdam Court of Appeals. The Supreme Court did not accept LVMH's contention that Gucci's Strategic Investment Agreement with Pinault Printemps Redoute S.A. ("PPR") be annulled. The Court also voided the Enterprise Chamber's findings of mismanagement by Gucci's board, and remanded the case to the Enterprise Chamber for further proceedings. The remand, based on a procedural technicality (1), is to the same Court that previously upheld the PPR transaction.
Accordingly, Gucci is confident that when the Enterprise Chamber reconsiders the matter, Gucci's strategic alliance with PPR will continue to stand.
Gucci remains dedicated to value creation for shareholders. The strategic alliance with PPR, which was overwhelmingly supported by independent shareholders at the July 1999 Annual General Meeting in Amsterdam (2), has enabled Gucci to pursue a multi-brand strategy and thereby to significantly enhance the value of the Group. Since the strategic alliance was implemented in March, 1999, all shareholders have benefited from Gucci's share price rise of 82% to Euro 116.4 (US$ 103.10) this morning.
LVMH has reported that it paid Euro 1,256 million for its stake in Gucci. Based on Gucci's share price this morning in Amsterdam the value of LVMH's stake in Gucci is approximately Euro 2,345 million, representing an unrealised capital gain of nearly Euro 1,100 million.
Domenico De Sole, President and Chief Executive Officer of Gucci Group N.V., said "The Supreme Court has today remanded the case to The Enterprise Chamber of the Amsterdam Court of Appeals. The Enterprise Chamber recognised that Gucci had the right to defend itself against a creeping take over attempt by a direct competitor and upheld the legality of the strategic alliance between Gucci and PPR.
This alliance has proven a tremendous success and has facilitated the Gucci multi-brand strategy, enabling us to create substantial value for our shareholders. We are confident that the Enterprise Chamber will continue to adhere to its fundamental conclusions. The main objective of Gucci's management and supervisory board will continue to be, as it has always been, to protect shareholders' interests and maximize shareholder value. We will continue to be totally committed to these principles".
Gucci Group N.V.
is one of the world's leading multi-brand luxury goods companies. Through the Gucci, Yves Saint Laurent, Sergio Rossi and Boucheron brands it designs, produces and distributes high-quality personal luxury goods, including ready to wear, handbags, luggage, small leather goods, shoes, timepieces, jewelry, ties and scarves, eyewear, perfume, cosmetics and skincare products. The Group directly operates stores in major markets throughout the world and wholesales products through franchise stores, duty free boutiques and leading department and specialty stores.
The shares of Gucci Group N.V. are listed on the New York Stock Exchange and on the Amsterdam Stock Exchange.
