Oct 26, 2023
Giorgio Armani Group has been preparing for its future for several years, as revealed on Thursday by Corriere della Sera. The Italian daily found out the contents of a document approved at an extraordinary shareholders’ meeting in 2016, completed in September and kept confidential until now. The document contains the articles of association of the future Giorgio Armani Spa, which will govern the group under the banner of continuity after the death of the 89-year-old fashion designer.
Giorgio Armani could open the door to the stock market, which will give “priority to the continued global development of the ‘Armani’ name”, to the “search for an essential, modern, elegant and unostentatious style.” In concrete terms, the group will have “six categories of shareholders in the capital, all of whom will be equal before the dividend (only “50% of net profits will be shared”). The document specifies, however, that some will have three times as many votes and the right to appoint the managing director, the equivalent of the chief executive in Italy.
The newpaper explains that the articles of association, which reports several extracts, will be formally adopted when the succession of Armani, who owns 99.9% of the group while 0.1% belongs to the Giorgio Armani Foundation, is opened. The fashion designer has no direct heirs but three grandchildren: Silvana and Roberta, daughters of his brother Sergio who died several years ago, and the son of his sister Rosanna, Andrea Camerana. They are all already members of the board of directors. As there are no heirs to satisfy, the entrepreneur will be free to dispose of all his assets.
In this plan, there are therefore six classes of shares, plus two without voting rights. A shareholders will hold 30% of the capital, F shareholders 10% and B to E shareholders 15% each. But each A share entitles its holder to 1.33 votes and each F share to 3 votes, giving A and F shareholders more than 53% of the votes with 40% of the capital.
In addition, the A shareholders are entitled to appoint three directors, including the chairman, and the F shareholders two directors, including the managing director, out of an eight-member board of directors.
It is highly likely that the Armani Foundation will be one of these two categories of shareholder. The A and F advisors will have decision-making powers on the board for strategic decisions (such as industrial plans, acquisitions or the brand), while an absolute majority of those present on the board will be sufficient to approve the financial statements and decide on the IPO once “the fifth year following the entry into force” of the statute has elapsed.
According to the Italian media, mergers, demergers, amendments to the articles of association and capital increases require 75% of the votes cast at extraordinary general meetings. It should be noted that the choice of male and female directors applies to all categories of shares. However, the A and F members will have a decisive right of veto and will therefore be able to steer the strategy and style signature of the future Armani, whose sales reached 2.35 billion euros in its 2022 financial year.
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