Bernard Arnault is the newest tycoon to pour money in the French media group Lagardere, to support founder Jean-Luc Lagardere's indebted successor, and getting a share in the firm which also has investments in publishing and retail.
Arnault, France's wealthiest man, revealed that he decided to buy a one-quarter equivalent of Lagardere Capital and Management, the holding of Arnaud Lagardere that oversees his investment within the iconic business empire.
Les Echos disclosed that the purchase was valued just under 100 million euros ($109 million). The company's stock was up as much as 15 percent after news of the investment.
The acquisition comes as the group searches for new shareholders to help curb activist fund Amber Capital, which has been demanding for extreme transformations at the company which includes an attempt to revamp its supervisory board.
French tycoons Marc Ladreit de Lacharriere and Vincent Bollore have likewise acquired shares in the group recently. Amber Capital is currently the Lagardère Group's biggest investor with 18 percent share of the capital.
A source with knowledge of Arnault's new investment disclosed that it cost the billionaire less than 100 million euros in acquisition and that his close ties with Jean-Luc Lagardere - who passed away in 2003 - was the impetus behind the investment.
On the other hand, Vincent Bollore's Vivendi bolstered its share in Lagardere SCA to 16.5 percent, making the group the second-biggest investor after Amber Capital, which failed to replace the so-called "commandite" corporate system, which focuses its influence in the hands of Arnaud Lagardere.
Lagardere was a massive organization that spanned the automobile, aerospace and media business until Jean-Luc's passing. Arnaud, his son, steered much of the business to move away from manufacturing. Arnaud now concentrates on two fronts: book publishing companies like Hachette and Grasset, and retail travel.
Lagardere controls some of France's biggest news firms including Journal du Dimanche, radio station Europe 1 and popular magazine Paris Match. The latest merger will allow Arnault to increase his outreach.
According to a joint statement, the new partnership will boost LC&M's portfolio and money-making potential. The groups of Arnault and Lagardère will act in consonance with respect to Lagardère SCA.
Meanwhile, the Arnault investment made public on Monday was finalized at the same time as Bollore's media firm, Vivendi SA, boosted its shares to over 16 percent from 11 percent. In April this year, Vivendi became the third largest stakeholder after Amber and Qatar Investment Authority.
