Hermès descendant wants to bequeath billions to his gardener

This article first appeared at ntv.de

A billionaire descendant of the founder of the French luxury company Hermès wants to adopt a former domestic worker in order to pass on half of his fortune to him. The single and childless Nicolas Puech is determined to bequeath billions to his former gardener in this way, as Swiss media report.

Hermès is valued at around 210 billion euros on the stock exchange. According to Forbes, Puech has a stake of around five percent in the fashion giant. The business magazine estimates the 80-year-old’s fortune at almost eleven billion euros. Hermès is the third largest listed company in France.

Power struggle in the Hermès house: descendant wants to bequeath assets to former domestic workers

According to the Tribune de Genève, Puech has hired a team of lawyers to reorganize his estate and initiate adoption proceedings. The French billionaire resides in Switzerland. According to the newspaper, there is an adult adoption thereAlthough it is certainly allowed, it is extremely rare. Whether the planned adoption under Swiss law under the given circumstances but is possible is unclear.

The potential heir is said to be a 51-year-old Moroccan from a modest background who is married to a Spanish woman and has two children with her. According to Swiss media, the couple has become a family replacement for Puech. He should refer to them as his “children”. The two would live in Montreux on Lake Geneva in a luxury villa worth the equivalent of around four million euros. Puech also gave his then gardener 1.5 million euros to buy a villa in the Moroccan city of Marrakesh. The couple also owns properties in Spain and Portugal.

The adoption plan faces resistance. In 2011, Puech signed an inheritance contract in favor of the Isocrate Foundation, which he founded. The Geneva-based organization supports initiatives and projects that combat disinformation.

According to the Swiss newspaper “Blick”, unlike a will, an inheritance contract cannot be changed immediately. In Puech’s case, the foundation’s approval is necessary. She doesn’t think much of it. “Based on the (…) available information, the desire to terminate the inheritance contract immediately and unilaterally appears to be unfounded and void,” said the foundation director in the “Tagesanzeiger”. They are strictly against the termination of the contract.

According to the reports, however, the inheritance contract states: If a child entitled to inherit appears, he or she would be entitled to at least half of Puech’s assets. That’s why the authorities now have to decide whether the ex-gardener will become the heir.

Family dispute is probably the reason for the planned adoption

The background to the unusual plan is likely to be a family dispute. The reason was that the luxury giant LVMH, led by Bernard Arnault, had secretly bought into Hermès and bought almost a quarter of the shares, most of them through the back door.

To get started, Arnault used special financial instruments whose trading is not subject to reporting in France. The so-called equity swaps are an ideal means of sneaking up on takeover targets. The Franconian auto supplier Schaeffler took a similar approach in 2008 when it attacked the much larger tire manufacturer Continental, and in 2005 Porsche did so in its ultimately failed takeover of the VW Group.

In 2014, the years-long power struggle between Arnault and the Hermès heirs ended. The French stock market regulator had previously fined LVMH eight million euros for secretly increasing its Hermès shares via the complicated system of financial derivatives. She also found that much of the stock Arnault bought through the swaps came from Puech.

LVMH sold most of the share package. The Hermès heirs brought their shares into a family holding company in order to be able to fend off future takeover attempts. It currently holds almost 70 percent of Hermès shares. Puech, however, refused to make his shares available to the holding company. He left the company’s supervisory board in 2014 – and apparently broke with his family.