LVMH INVESTING IN JAY-Z'S ARMAND DE BRIGNAC CHAMPAGNE
The luxury group LVMH has bought half of Jay-Z's bubbly empire. The Champagne brand Armand de Brignac, known as the “Ace of Spades” is now 50% owned by the LVMH, but there was no disclosure about the exact terms of the deal.
The 51-year-old billionaire announced on Monday that he has sold 50% of his Champagne company stake to LVMH's Moët Hennessy. The partnership with the luxury giant is supposed to “give Armand de Brignac the commercial power it needs to grow and flourish even further.”
Shawn Carter established Armand de Brignac in 2006 after popularizing the French brand Cristal, using it in his music videos. After Frederic Rouzard, the CEO of Champagne Louis Roederer (maker of Cristal), made a racist remark on Jay-Z in the Economist magazine, rappers called for a boycott.
The consequences came rapidly -- at the 2006 BET Awards in LA, the A-list of African American entertainers was enjoying Dom Pérignon and Veuve Clicquot instead of previously omnipresent Cristal Champagne, following with the entire hip-hop community.
Shawn Carter ranked at No. 16 in Fortune magazine's “40 Under 40” list in 2004, also the owner of Roc nation which in 2019 was worth an estimated $75 million, decided to build his own Champagne company. He featured the signature gold bottles of Armand de Brignac in the “Show Me What You Got” music video in 2006, becoming the full owner after buying the remaining of the stakes in 2014.
The partnership came at the time of the COVID-19 pandemic, when champagne companies are in a difficult position, facing challenges. The global luxury market is shrinking, since the in “new normal” there are no big celebrations, no nightlife, fashion shows, and sports events are taking place without the audience. According to that, the industry leaders are reinventing their strategies in order to survive and not to end out of the business.
In the era of social awareness, when consumers are demanding more inclusive businesses, considering age, ethnicity, and gender, LVHM is making all the right moves. We are witnessing how brands are trying to attract more women and African-Americans, and LHMV already made some prominent collaborations like the one with Rihanna and her cosmetic line Fenty Beauty.
One thing is sure -- LVHM going into business with the “Ace of Spades” will bring the world's biggest producer of Champagne wider clientele, pushing the company even more towards diversity.
“We are going into this partnership on equal terms together with Jay-Z and his family and with the same conviction that we are only at the beginning of a wonderful story,” says Phillipe Schaus, the chief executive of Moët Hennessy.