A Lifetime Friendship? Jacobs and Duffy Near New Deals With LVMH

Marc Jacobs and Bernard Arnault are near resolution of a contract dispute that would cement the designer as the creative force behind Louis Vuitton.

  • Jacobs also would sign a 10-year contract to remain at Louis Vuitton, replacing the current deal that expires in 2008. He is said to be negotiating for additional creative control over advertising and ancillary products, as well as a significant increase in compensation, in terms of salary and stock options.
    LVMH officials declined to comment on the talks on Wednesday.

    If Jacobs and Duffy resolve their differences with LVMH in coming weeks, the deal would conclude a volatile few months for the designer, during which he has been approached by numerous suitors to work his magic on other luxury brands while his company reportedly has been pursued as an acquisition by Lawrence Stroll and Silas Chou. Jacobs also surprised the LVMH brass by publicly discussing their feud in The Wall Street Journal during the kickoff of Louis Vuitton’s 150th yearlong anniversary celebration in February.

    Rumors have continued to dog LVMH recently about its intentions to hold on to certain assets, with Stroll’s name coming up frequently as a suitor for the Jacobs business or as a possible licensee for the Marc by Marc Jacobs lower-priced line. Stroll and Chou bought the Michael Kors business, including LVMH’s share, more than a year ago and are looking to acquire other brands, but Stroll is also said to be hot to get Jacobs to take on a creative role at Asprey, which he and Chou also own through a separate company, A&G Group. The creative director position at Asprey has been vacant since designer Hussein Chalayan left after his contract expired in February.

    Stroll’s interest in Jacobs is said to be so great that Arnault reportedly offered to let Jacobs go if Stroll would be willing to make a deal to also buy Donna Karan International, which LVMH has widely been described as shopping, but unable to sell because of its high price tag. It could not be learned whether Arnault’s offer was a serious one, however.

    Arnault’s endorsement of a business is regarded as a key indicator of its ranking in priority among LVMH’s many divisions, and he has recently singled out the performance of Vuitton and Jacobs. In LVMH’s quarterly report last week, Jacobs’ latest creations for Vuitton, such as the Theda bag and Giant Damier luggage, were described as making a “hugely successful debut.”
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