Stock Market as Acquisition War Chest

"Arnault knows, however, that he cannot play the game of "my ideas, your money" with financiers for long. Especially if he wants to attack healthy companies. This observation is not an obstacle, however. The miracle solution exists. It's the stock market. Next time, instead of relying on financial support from investors, he will introduce the capital of his various companies to the stock market."

"Each call to the market will now provide him with his starting investment. The best way to orchestrate takeovers with other people's money. Small shareholders will thus replace the bankers of the early days."

"For his first call to the market, the buyer of Boussac chose Conforama. He offers small shareholders 15% of the capital. The financial profitability of the chain of stores clearly ensures the success of a stock market introduction. The operation was launched in September 1987. An indisputable success. The second company to take the path to the Palais Brongniart will be Arnault & Associates. Shortly after Conforama, the family company will sell 10% of its capital at a high price: 490 francs per share."

"The technique, although complex, is perfectly mastered. This is the fourth time he has used it: one year before, he introduced Conforama on the second market, then the holding company Arnault and Associates, of which the family kept only 60%. He has just placed 42% of Dior's capital with private investors to raise 3.3 billion francs, which allowed him to continue buying LVMH shares. The principle is simple: 1. He buys companies; 2. He improves them; 3. He can then raise capital to make new acquisitions."