With the news that French luxury conglomerate PPR has offered to buy Volcom for $607.5 million, we took a deeper look at the company.
PPR is a publicly held company traded on the French stock exchange, Euronext Paris.
Its revenues in 2010 totaled 14.6 billion Euros, which is the equivalent of $21.7 billion U.S. if converted at today’s exchange rates.
The company is mostly known for its consumer and luxury brands, which include Gucci, Botega Vennetta, Yves Saint Laurent, Balenciaga, Alexander McQueen, Boucheron, Sergio Rossi, and Stella McCartney. It also has a sport and lifestyle selection of brands including PUMA, which also owns Cobra Golf and Tretorn.
Another part of PPR’s portfolio is FNAC, which is one of the leading e-commerce sites in France and distributes cultural and technological products like DVDs, music and books in several international countries.
It also own Redcats, a group of European and American brands that specialize in online retailing of fashion and home furnishings and cater to a range of customers from maternity and plus size to sports and leisure items. Brands under Redcats include La Redoute, The Sportsman’s Guide, and The Golf Warehouse.
PPR has said it wants to sell FNAC and Redcats to focus on its Luxury and Sport & Lifestyle groups, according to published reports.
Last week, PPR reported that first quarter revenue was up 9%, led by Luxury which makes up the biggest part of the company. Luxury sales rose 26%, and Sport and Lifestyle revenue (which PUMA is under and Volcom will fall into), increased 13%.
While PPR’s headquarters are based in France, it distributes its brands to over 120 countries. As of December 31, 2010, PPR had 60,000 employees.
On page 2: A look at PPR CEO Fancois-Henri Pinault and his family
Actress Salma Hayek and François-Henri Pinault
François-Henri Pinault, Chairman and CEO of PPR, is married to the Mexican actress Salma Hayek, and is from one of the most prominent and influential business families in the world.
His father, Francois Pinault, was a high school dropout who founded the company in 1963.
He started it as a timber trading business in his home region of Brittany, and moved into industrial goods and then into retail, building the business through a series of acquisitions.
In March of this year, Forbes Magazine listed Francois Pinault and his family as having a net worth of over $11.5 billion.
The father is still a major stockholder at PPR. He also owns the auction house Christie’s and has a personal art collection worth an estimated $1.7 billion, including works by Pablo Picasso, Piet Mondrian and Jeff Koons.
The billionaire also owns Chateau Latour, a winery that’s been around since 1331, Le Point magazine and a football stadium.
Francois-Henri Pinault became CEO and Chairman of PPR in 2005. He graduated from France’s HEC business school, and joined the Pinault Group in 1987, when he started his career as a salesman in the timber import and retail business and later established the company’s purchasing group for which he was responsible until 1989.
Today, he is also Chairman of the Supervisory Board of Puma AG, Vice-Chairman of the Supervisory Board of CFAO and is a member of the Board of Directors of Bouygues.
It was not clear how the company is structured, though it seems that each group has a CEO and Creative director and that PPR promotes synergies across brands where appropriate. But it gives each brand a lot of autonomy, which is “crucial for guaranteeing their identity and their creative expression,” according to the company website.
(See our Executive Edition story from the PPR conference call for more details about how PPR plans to add value to Volcom and who Volcom management will report to.)
It also appears that the company has and continues to develop strong back-end support for its brands, including a recently set-up E-business Development Department, whose role is to provide “a systematic framework for developing inter-brand synergies and coordinate e-business projects,” the site says.
PPR also seems to have a strong CSR component as well as a foundation that promotes women’s dignity and rights.
