Kering Shares Soar: Renault CEO Luca de Meo’s Exit Fuels Kering’s Comeback Hopes
Amidst allegations that the French fashion house Kering had named industry outsider Luca de Meo as global CEO, the company’s shares surged more than 10% on Monday. It comes as the owner of struggling labels Saint Laurent and Gucci starts the most recent stage of its recovery.
De Meo’s resignation as CEO of Renault was officially announced on Sunday. The French automaker said in a statement that he was leaving to take on new challenges outside of the automotive industry. He’ll be there till July 15.
Kering Gains on Rumors De Meo to Take Over CEO Role from Pinault
Le Figaro, the French newspaper, was the first to report on De Meo’s shift to Kering on Sunday. By 9.45 a.m. London time, Kering shares were up 10.3% as analysts and investors applauded the findings. In the meantime, Renault’s stock fell 7%.
Brand management and marketing are de Meo’s forte, which dovetails with what the luxury industry does,
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According to sources cited by Reuters, Kering‘s current chairman and CEO, François-Henri Pinault, is a member of the family that owns the company and has presided over the company for 20 years. He is actively seeking a successor. The sources claim that Pinault plans to divide the responsibilities of CEO and chair. Whether he would continue to serve as chair remained uncertain.
Renault’s Turnaround Chief De Meo Faces Tough Challenge at Kering’s Gucci
Having worked in the automotive industry for more than 30 years, notably at Toyota, Fiat, and Volkswagen, De Meo is regarded as having a solid track record. With shares up more than 90% over his five years in charge, the Italian is primarily responsible for Renault‘s revival.
However, the problems affecting the luxury market are significant, and Kering is one of the largest laggards as consumers have lost interest in its flagship Gucci brand. A string of profit warnings and designer changes at Gucci have caused Kering’s stock to drop more than 60% over the past two years.
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