Fund backed by L'Occitane invests in macaron maker Pierre Hermé
PARIS - Fast-growing luxury pastry maker Pierre Herm? plans to expand in North America and China, helped by the arrival of a new minority shareholder backed by cosmetics group L'Occitane, its chief executive said.
PARIS - Fast-growing luxury pastry maker Pierre Hermé plans to expand in North America and China, helped by the arrival of a new minority shareholder backed by cosmetics group L'Occitane, its chief executive said.
The deal is the latest sign of growing investor interest in luxury food, which has been enjoying solid growth, buoyed by local and tourist demand.
Pierre Hermé, the company co-founded by the French chef known for his audacious flavour mixes and macarons, has seen sales rise fivefold in the past five years to 50 million euros ($54 million). It runs as many stores today in Japan as in France.
The pastry company said on Friday L'Occitane's entrepreneurial fund, called Log Investment, was taking a stake of around 40 percent with control remaining in the hands of co-founders Pierre Hermé and Charles Znaty, the chairman.
"The world of cosmetics and food carry many similarities. We both makes things based on recipes and worry about supply chains and retail networks," Znaty told Reuters in an interview.
He aimed to tap into L'Occitane's experience, particularly in retail expansion.
L'Occitane, the maker of face creams and the first French company to go public in Hong Kong in 2010, today runs a network of more than 2,000 shops worldwide in more than 100 countries.
Comparatively, Pierre Hermé has some 50 stores and a café inside Dior's new flagship store in Seoul, and is present in 13 countries.
Znaty said Pierre Hermé aimed to double the size of its network in the next five years or so.
Log Investment's entry into the company's share capital allowed minority investors such as CM-CIC Capital Privé and two early backers to exit. Financial details were not divulged.
Pierre Hermé is a member of the prestigious French luxury trade group Comité Colbert, which counts around 80 members such as Louis Vuitton and Chanel.
Pierre Hermé's best-sellers include the Mogador, mixing milk chocolate and passion fruit, and the Ispahan, combining rose, raspberry and lychee. An assortment of 20 macarons costs 64 euros while one macaron costs 2.10 euros.
Znaty first set up a food consultancy business with Pierre Hermé before they created their pastry company in 1997.
Hermé and Znaty helped with the re-launch of arch-rival La Durée, the other French macaron specialist, after it was acquired by the family behind bakery chain Paul in 1993.
Znaty said Pierre Hermé opened its first shop in Japan in 1998 to avoid competing with La Durée head-on, and only later started selling macarons in Paris.
"At first, the banks did not believe in us so we had to find financiers elsewhere," Znaty said.