Fashion business primer: A peek behind the double Diors
I learned a couple of interesting things while working on the the article for Wednesday's Los Angeles Times Calendar section about Christian Dior's recent decision to fire John Galliano.
First was that, under French law, making anti-Semitic remarks -- as Galliano allegedly did in a Paris bar on one or more occasions -- is not just offensive, it's actually illegal under the provisions of a law passed in 1990.
The second, and perhaps most interesting in a man-behind-the-curtain way for the people who follow the business side of the fashion world, is the corporate structure of Christian Dior -- which, to risk sounding like "The Price Is Right" -- is actually more like "Dior No. 1" and "Dior No. 2."
At the top of the organizational chart (yes, there is one -- which you can see here) is a French holding company called Christian Dior SA (the SA stands for "Société Anonyme" -- the French term used to designate a corporation), which in turn owns 100% of Dior No. 2 -- Christian Dior Couture.
It's this entity that makes, sells and (in the case of some categories like fragrances) licenses Christian Dior branded goods. It was also the direct employer of Galliano -- and it was Christian Dior Couture's Chairman and Chief Executive Officer Sidney Toledano who issued the March 1 statement condemning Galliano's purported actions.
But Christian Dior SA (a.k.a. Dior No. 1) also has a 42.4% stake in LVMH -- the French luxury conglomerate that owns the Louis Vuitton, Marc Jacobs, Givenchy and Emilio Pucci brands, among others.
To make things only slightly more confusing is the fact that nearly 70% of Christian Dior SA's stock is owned by yet another entity -- Groupe Arnault -- the investment vehicle for French businessman Bernard Arnault. (Did we mention he also owns additional shares of LVMH?)
So now you know.
-- Adam Tschorn
Photo: Bernard Arnault at a Feb. 4 press conference presenting the LVMH group's 2010 results. In addition to serving as chairman and CEO of that company, (and owning more than 40% of its stock), he is the majority owner and chairman of the Christian Dior brand's parent company. Credit: Gonzalo Fuentes / Reuters.