Battle Over Chateau d'Yquem Ends With LVMH as New Owner
That day, Arnault had finally reached his goal: LVMH Moet-Hennessy Louis Vuitton, France's prestigious luxury goods company, became the new majority owner of Yquem, the world's most famous sweet-wine estate.
As the multinational corporation took over a chateau that had been under family control for some 400 years, Lur Saluces underscored the importance of the event by serving Arnault a 100-year-old wine -- the 1899 Yquem (91, $1,814). By the next day, it was clear that the two men had changed their tone toward each other.
"I found in Count Alexandre de Lur Saluces a person who's totally open, as well as passionate and refined," Arnault said on Tuesday. "The discords of the past are totally gone. I pay my respect to him to have brought this marvelous wine to this level."
The Paris-based industrialist, 50, and the Bordelais aristocrat, 68, had exchanged only angry words in the media and in the courtroom since Arnault bought 55 percent of Yquem from family shareholders for $101 million in late 1996. In a very public family feud, Lur Saluces filed numerous lawsuits to block the sale of his relatives' shares to LVMH.
Despite numerous setbacks in court, Lur Saluces held LVMH at bay until the end of 1998, when the company was granted a minority stake in the chateau. Lur Saluces previously told Wine Spectator that he was fighting the acquisition because he was afraid LVMH would dilute the quality of the estate's renowned wines and even use the Yquem name on other consumer products.
Several months ago, Arnault told the magazine that he would prevail, saying that the count was running out of legal arguments. He added that he had offered Lur Saluces the opportunity to remain at Yquem and had promised the vintner that LVMH wouldn't dream of lowering the wine's quality.
Over the last couple of weeks, the two men's lawyers quietly negotiated a settlement to the long conflict. In the deal, LVMH becomes a bigger owner than it had originally planned by purchasing the 9 percent stake owned by Lur Saluces and his son Bertrand. Lur Saluces also withdrew his objection to his brother Eugene selling some of his shares to Yquem -- about a 17 percent stake, which LVMH had agreed to purchase in the original deal. (However, Alexandre still claims part ownership of his brother's fortune in a separate, ongoing lawsuit.)
The parties declined to say how much LVMH paid for Alexandre and Bertrand's stake. If the shares went for the same price that the company paid in 1996, when the estate was valued at 1 billion francs, the Lur Saluces would have received 90 million francs (more than $14.6 million) for their holding. But sources speculated that LVMH paid more just to get Lur Saluces to drop his lawsuits and encourage him to sign the deal.
Yquem is the third luxury wine estate purchased by Arnault in less than a year. He and an associate bought Chateau Cheval-Blanc in St.-Emilion last October, and LVMH purchased Champagne Krug in January. LVMH owns other top Champagne brands, including Moet & Chandon and Veuve Cliquot.
Lur Saluces will stay on at Yquem as CEO of the estate, whose new corporate name is Chateau d'Yquem Inc. Lur Saluces and Arnault said that they have agreed on the future direction of the chateau and the pursuit of a policy that strictly respects tradition and quality.
"My responsibility is to do all that is in my power so that Yquem remains what it is," said Lur Saluces. "The promises I've received from Bernard Arnault and the executives of Groupe LVMH seem to guarantee that the values I've upheld will be maintained. I'm happy to continue the work of my predecessors with them at Yquem."
For complete tasting notes of Yquem, look for Per-Henrik Mansson's report on a vertical tasting of 125 vintages of Yquem in the May 15 issue, on sale now.
For a complete history of the Yquem takeover struggle:
LVMH Wins Minority Stake in Chateau d'Yquem
Struggle Over Chateau d'Yquem Continues
Lur Saluces Loses Major Battle in War for Control of Chateau d'Yquem
Chateau d'Yquem Manager Wins a Round
Passion vs. Profit
Lur Saluces Challenges LVMH Deal for Yquem
LVMH Buys Controlling Interest in Chateau d'Yquem
For more on Bernard Arnault and LVMH:
Krug Champagne Bought by LVMH
Chateau Cheval-Blanc Sold to LVMH Chairman and Belgian Businessman
The Billionaires: Bernard Arnault