Arnault resigns from Guinness board
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Your support makes all the difference.Bernard Arnault, the combative chairman of LVMH, the French luxury goods group, turned up the heat on the Guinness-Grand Metropolitan merger yesterday when he resigned from the Guinness board to allow him more time on "promoting his alternative proposal".
Mr Arnault's advisers, BZW, said he had decided to quit "in the face of the opposition of the board of Guinness". The statement repeated Mr Arnault's belief that his own plan to develop a three-way merger of the wines and spirits businesses of Guinness, GrandMet and LVMH, plus a de- merger of the other businesses, offered shareholders "significantly greater value".
An LVMH spokesman said: "Mr Arnault was disappointed with the speed with which his proposals of last week were rejected."
Guinness said: "We can confirm that we have received Mr Arnault's resignation.... Clearly this was not a surprise since he has recently adopted a different view to the rest of the board on the future strategy of the company."
Mr Arnault has not attended any of the monthly Guinness board meetings since the pounds 23bn merger with GrandMet was announced in April. He will step down immediately and so not attend the next scheduled meeting later this week.
It is thought that Mr Arnault had hoped his position on the Guinness board might make it easier to promote his alternative proposals. However, the rapid response to his 18 page memo last week convinced him that there was no point in continuing.
Guinness said that it was in the process of examining Mr Arnault's document and that a reply would be made "in due course".
Mr Arnault has been a Guinness board member since 1989. He still controls a 14.2 per cent stake, making him the drinks group's largest single shareholder. He is also the largest shareholder in GrandMet with a stake of over 6 per cent.
Guinness declined to comment yesterday on whether Mr Arnault's resignation would make him more of a threat to the proposed merger.
Mr Arnault's camp said there had not been a complete breakdown of relations between the two groups. A spokesman for Mr Arnault denied that his resignation was a fit of pique over the response to his proposals, which would have given him a 35 per cent stake in a merged three-way drinks group. "Mr Arnault is not an emotional man."
Guinness shares closed 5p lower at 607.5p. GrandMet shares shed 10p to 606p.
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