Kering: Luca De Meo Takes Office And Recent Cyberattack

Pinault called on Luca De Meo to revitalize a group weakened by growing debt: in the first half of the year, Kering recorded a 15% decline in sales and a 46% drop in profits. The Italian executive appears to be a strategic choice for this CEO position, which was created especially for him: with a solid career in the automotive industry, he has contributed to the recovery of several struggling companies, including Renault.

Luca De Meo has already announced his intention to “act without delay” in order to “rationalize, reorganize, and reposition” several of the group's brands, particularly its major brand Gucci, which is still struggling to recover and attract new buyers. Gucci, which generates nearly 50% of Kering's revenue, saw its sales fall by 26% in the first half of the year, reaching €3 billion.

The group's shareholders voted 98.97% in favor of Luca De Meo's appointment. This comes as no surprise, since the Pinault family holds 59.3% of the voting rights (and 42.3% of the capital) through the Artemis financial holding company. De Meo is therefore embarking on this new managerial adventure with a signing bonus of €20 million and a salary of €2.2 million per month.

While the group's debt remains the main challenge to be resolved, other issues are also on the list. Among these, cybersecurity is proving to be an increasingly important issue: according to a press release, Kering was the victim of a cyberattack last June launched by an international group of hackers known as “ShinyHunters,” which seems to be targeting luxury brands in particular.

In early September, they attacked car manufacturer Jaguar Land Rover, causing a temporary halt in production. In claiming responsibility for this new attack, the cybercriminals claimed to have personal data concerning customers of brands such as Gucci, Balenciaga, and Alexander McQueen. For its part, Kering has reassured its buyers. After detecting unauthorized third-party access to the system, the company was able to protect sensitive data such as bank details and stored personal information.

Despite the difficulties, Kering wishes to continue its policy of agreements and partnerships with other brands to boost its portfolio offering. The latest agreement was signed with Valentino for its eyewear. The famous Italian fashion house is 30% owned by the Pinault family group (the remaining shares are owned by the Qatari investment fund Mayhoola). Valentino eyewear will now be distributed worldwide by Kering Eyewear.

Upon taking office yesterday, Luca De Meo stated that he is passionate about “brand storytelling” and wants to be part of “winning teams.” Will the Italian executive succeed in turning around one of the pillars of the global luxury industry?