Chanel’s no to IPO, but yes to acquisition to strengthen production, as well as a “maybe” on an additional increase in price tags, specifically for “it” bags. Leena Nair, CEO of Chanel (on the left in photo from Creative Commons), spoke with the Financial Times to put an end to the (periodic) rumors of a potential IPO for the luxury brand owned by brothers Alain and Gerard Wertheimer. No IPO, with Nair preferring to discuss vertical acquisitions and prices.
No IPO
“We will remain a private and independent company”, repeats Nair to the Financial Times. A statement often repeated in the last few years by Chanel’s CFO as well, Philippe Blondiaux. “Rumors are always present, but they can be disregarded”, cuts short Nair. In reality, in 2018, the company decided to publish the financial results for the year to support the message it has passed on to the market often: remaining private and independent. Yet, as a result, the decision caused news sources to spread rumors of the Wertheimer brothers getting ready for an IPO.
Yes to vertical acquisitions
Chanel acquired 25 of its suppliers in 2021, investing a total of 1.1 billion USD in technology, buildings and manufacturing. Nair stated that the luxury brand “continues to evaluate” the opportunities to consolidate its supply chain. “We want to preserve artisanship, and so we will continue to acquire the knowhow and laboratories that make sense for us”, says the CEO.
New increase to price tags?
“Just like everybody, we respond to cost variability. The cost of raw materials, manufacturing, the fluctuations of exchange rates”, commented Nair. The CEO also remained vague in relation to an additional increase to Chanel’s price tags, but prepares the field. “I see inflation numbers increasing in all markets, and the costs of raw materials and manufacturing aren’t slowing either”, she concludes.
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