Armani's Final Cut: Will Forces 15% Sale in 18 Months, Sets Up 30-54.9% Takeover or IPO - LVMH, L'Oréal and EssilorLuxottica Favoured

Giorgio Armani's last will has a twist that few in Milan expected: the heirs are to either start selling stakes in the fashion house he built or prepare the business for a stock market debut.

The designer, who died on September 4 at 91, left instructions that an initial 15% slice of the company must be sold within 18 months. A further transfer - enough to bring the buyer's holding to between 30% and 54.9% - is to take place three to five years after his death. The document gives priority to a short list of heavyweight luxury players: LVMH (Euronext: MC), L'Oreal (Euronext: OR) and EssilorLuxottica (Euronext: EL), or to an acquirer of "equal standing" that the Giorgio Armani foundation and Pantaleo Dell'Orco - the designer's life partner and business lieutenant - agree on.

If a private sale doesn't materialize, the will orders heirs to pursue an initial public offering in Italy or on an exchange of comparable status. In the event of a listing the Fondazione Giorgio Armani would keep a 30.1% stake. Combined, the foundation and Dell'Orco control 70% of voting rights under the will.

That language is a sharp break from Armani's long-held determination to keep the company private and tightly controlled. He had been the main shareholder since founding the label with Sergio Galeotti in the 1970s and rebuffed repeated approaches over the years.

By the numbers: the group reported revenue of roughly €2.3 billion in 2024, but profits have been under pressure amid a soft patch for luxury players. Armani left no children, so the succession plan in the will carries heavy weight for the brand's future buyers or a public-market valuation.

What it means for listed luxury names and market activity is straightforward: a staged sale or a potential IPO would be a sizable corporate event in European luxury. A strategic buyer - especially the firms named in the will - would gain a storied brand with profitable wholesale and retail channels, even if short-term profitability has been squeezed. An IPO would create a new public comparable for peers and hand the foundation a meaningful residual stake to influence governance post-listing.

The timing spelled out in the will narrows the window for big moves. Expect initial market chatter and deal noise within the next 18 months as the heirs are obligated to test the private-sale route first. The later 3-5 year transfer provision also opens room for phased deal structures rather than a single one-off transaction.

For now, the headline is simple: a company long synonymous with founder control has been handed a roadmap toward outside ownership or public markets, with clear preferences for major industry names or a domestic IPO and a majority of voting power remaining tied to the foundation and Dell'Orco. How the luxury giants named will react - and whether bankers and advisers can stitch together a buyer willing to take a staggered stake - is the next chapter.

A final note from the will: the foundation is instructed to favour companies already linked commercially to Armani when evaluating buyers, which keeps the shopping list narrow and strategic rather than purely financial. So, which of the big players moves first?