LVMH Inks Deal with Jay-Z for a 50% Stake in Champagne Brand


March 4, 2021 | AtoZ Markets – French conglomerate LVMH has acquired a 50% stake in rapper Jay-Z’s champagne brand Armand de Brignac, also known as ‘Ace of Spades’. The owners of Dom Pérignon and Moët & Chandon will take over the global distribution for the eye-catching champagne, known for its metallic bottles that cost hundreds of dollars each.

LVMH, the world’s biggest producer of champagne, will also likely pull from their luxury-marketing expertise and vast resources as champagne sales struggle amid delays and cancellations of weddings and other celebrations due to the ongoing Covid-19 pandemic. Enjoy high leverage, tight spreads and swift withdrawals on CFDs on LVMH.PA and more with LonghornFX.

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The hip-hop mogul set his eyes on Armand de Brignac in 2006 when he featured one of their bottles in a music video, following a bitter dispute with his former favourite luxury champagne, Cristal. Jay-Z then went on to become one of the earliest investors of the brand before buying the remaining stake in the business, previously held by Sovereign Brands, a New York-based wine and spirits company, in November 2014.

The Roc Nation founder has since helped usher in a new era for the brand, growing its presence in bars and nightclubs, selling more than 500,000 bottles in 2019. LVMH’s purchase of Armand de Brignac further cements the alliance between the world of hip-hop and luxury, breaking into previously uncharted markets and ushering in a new wave of champagne drinkers.

Although it may not appear to be the best time to invest in champagne, LVMH’s deal with Jay-Z comes at a critical moment within the luxury sector as it continues to face scrutiny over racism allegations.

The company appears to be making a conscious effort to appeal to a more diverse clientele, announcing tennis champion Naomi Osaka as the latest Louis Vuitton brand ambassador, while also collaborating with global superstar Rihanna on the cosmetics line, Fenty Beauty. Armand de Brignac presents a unique opportunity for LVMH to broaden its brand portfolio and tap into a new audience, drawing from Jay-Z’s celebrity pull.

The announcement has since caused the group’s stock price to rise, opening at a strong 546.20 on the 3rd of March, with a 5% increase year to date. The possibilities to profit are endless with LVMH! Experience trading with a difference with LonghornFX. Magnify your trading results with CFDs on stocks like LVMH.PA and more by benefitting from lower trading costs and enhanced flexibility.

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