ADOPTION PLANNED - Hermès descendant wants to bequeath billions to his gardener
This article first appeared on ntv.de
A billionaire descendant of the founder of the French luxury company Hermès wants to adopt a former domestic worker in order to pass on half of his fortune to him. Nicolas Puech, who is single and childless, is determined to bequeath billions to his former gardener in this way, according to Swiss media reports.
Hermès is valued at around 210 billion euros on the stock exchange. According to Forbes, Puech has a stake of around five percent in the fashion giant. The business magazine estimates the 80-year-old's fortune at just under eleven billion euros. Hermès is the third-largest listed company in France.
Power struggle at Hermès: descendant wants to bequeath fortune to former employee
According to the "Tribune de Genève", Puech has hired a team of lawyers to reorganize his estate and initiate adoption proceedings. The French billionaire is domiciled in Switzerland. According to the newspaper, the adoption of an adult is permitted there, but is extremely rare. However, it is unclear whether the planned adoption is possible under Swiss law under the given circumstances.
The potential heir is said to be a 51-year-old Moroccan from a modest background who is married to a Spanish woman and has two children with her. According to Swiss media, the couple has become a family substitute for Puech. He is said to refer to them as his "children". The two would live in Montreux on Lake Geneva in a luxury villa worth the equivalent of around four million euros. Puech also gave his then gardener 1.5 million euros to buy a villa in the Moroccan city of Marrakech. The couple also own properties in Spain and Portugal.
The adoption plan has met with resistance. In 2011, Puech signed an inheritance contract in favor of the Isocrate Foundation, which he founded. The Geneva-based organization supports initiatives and projects that combat disinformation.
According to the Swiss newspaper "Blick", unlike a will, an inheritance contract cannot be changed immediately. In Puech's case, the foundation's consent is required. The foundation thinks little of it. "Based on the (...) available information, the wish to immediately and unilaterally dissolve the inheritance contract appears unfounded and null and void," the foundation director told the Tagesanzeiger newspaper. They are strictly against the dissolution of the contract.
According to the reports, however, the inheritance contract states that if a child entitled to inherit were to appear, it would be entitled to at least half of Puech's assets. The authorities must therefore now decide whether the ex-gardener will become an heir.
Family dispute is probably the reason for the planned adoption
The background to the unusual plan is likely to be a family dispute. The reason was that the luxury giant LVMH, managed by Bernard Arnault, had secretly entered Hermès and bought almost a quarter of the shares, most of them through the back door.
Arnault had used special financial instruments for the acquisition, the trading of which is not subject to reporting requirements in France. Equity swaps are an ideal means of sneaking up on takeover targets. The Franconian automotive supplier Schaeffler took a similar approach in 2008 when it attacked the much larger tire manufacturer Continental, as did Porsche in 2005 with its ultimately failed takeover of the VW Group.
In 2014, the years-long power struggle between Arnault and the Hermès heirs came to an end. The French stock exchange supervisory authority had previously fined LVMH eight million euros for secretly increasing its Hermès shares via the complicated system of financial derivatives. It also discovered that a large proportion of the shares that Arnault bought via the swaps originated from Puech.
LVMH sold the majority of the share package. The Hermès heirs transferred their shares to a family holding company in order to fend off future takeover attempts. It currently holds almost 70 percent of Hermès shares. However, Puech refused to make his shares available to the holding company. He left the company's supervisory board in 2014 - and apparently broke with his family.
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- Despite facing resistance from the Isocrate Foundation, the French billionaire Nicolas Puech, who has a stake in luxury company Hermès and is worth nearly eleven billion euros, is planning to adopt his former gardener to bequeath half of his fortune to him.
- The 80-year-old Puech, who is domiciled in Switzerland and has two children with his Spanish wife, has hired a team of lawyers to reorganize his estate and initiate adoption proceedings.
- The adoption of an adult is permitted in Switzerland, but is extremely rare and it's unclear if Puech's plan is legally possible under the given circumstances.
- Bernard Arnault, the manager of LVMH, the largest luxury group in the world, has been involved in a power struggle with Hermès heirs for years. Arnault had secretly acquired almost a quarter of Hermès shares through financial derivatives, which is against French regulations.
- The betrayal from his family and LVMH's takeover attempt may have contributed to Puech's decision to disinherit his family and adopt his former gardener, as mentioned in various headlines such as "Top news: Adoption plan by Hermès descendant stirs controversy" and "Headlines: billionaire's adoption plan raises legal questions".
Source: www.stern.de
