François-Henri Pinault is no stranger to the film industry. In 2009, he married actress Salma Hayek. Photo: Mark Piasecki/FilmMagic
“Hollywood is a small family place,” Michael Ovitz once said.
Co-founder of the talent agency Creative Artists Agency (CAA). ), once called the most important man in Hollywood, played on the notion that everyone in the movie business knows everyone to protect himself from allegations of conflict of interest in the early 1990s.
Today in An unfamiliar person came to town and attacked the very business that Ovitz was building.
François-Henri Pinault, the French billionaire owner of luxury brands such as Gucci, Balenciaga and Saint Laurent, has struck a surprise deal to buy a majority stake in CAA, one of the most powerful talent agencies in the world.
Family Pinault negotiated the deal through her holding company Artémis, which also owns a majority stake in luxury goods group Kering.
Terms of the deal with Texas private equity group TRG were not disclosed, but it is believed to be worth billions and is believed to be the largest deal Artemis has ever made. CAA is one of Hollywood's most renowned talent agencies, representing Scarlett Johansson, Brad Pitt, Margot Robbie, Steven Spielberg and, among others, Pinault's wife Salma Hayek.
It also represents a host of sports stars, including the midfielder Tottenham Hotspur James Maddison and Real Madrid manager Carlo Ancelotti, as well as celebrities in less popular fields such as podcasting, video games and fashion influence.
The agency will join Artémis' investment portfolio, which, in addition to Kering, also includes Christie's auction house and Château Latour winery.
The acquisition of CAA marks Pinault's boldest move outside of his core luxury sector. But experts say the deal reflects the increasingly blurred line between designer brands and the celebrities who endorse them.
«This is an absolutely extraordinary opportunity for Hollywood talent and luxury to cross paths,» says Andrew Maag, a former Burberry executive. Europe.
Designers and luxury goods companies have been struggling for years to attract celebrities as “brand ambassadors.” Maag says Pinault's deal with CAA «could take this to the next level.»
Actors and sports stars could help develop content for brands or work even more closely with fashion brands on their products.
“This is a natural evolution of the luxury and fashion sectors joining the nexus of film, television, music and sports in the digital media and marketing space,” says Maag.
CAA co-chairman Brian Lourd is set to assume the role of CEO after the deal
In a joint statement, CAA co-chairs Brian Lourd, Kevin Huvane and Richard Lovett said Pinault and his family «share our vision for a future with limitless new opportunities,» highlighting its «global reach and resources across our clients' countless areas of operation.» interests.»
Lourd, George Clooney's agent, will become CEO once the deal is completed. All trio have made long-term commitments to remain in the business and will remain co-chairmen.
For his part, Pinault said in a statement: “CAA has all the necessary characteristics to become part of the Artémis family, which adds even more diversity, both in terms of geographical presence and business activity, to our other assets.”
< p>Although Pinault, who is worth an estimated $32 billion, has not done much business in Hollywood before, he is no stranger to the industry.
The 61-year-old married actress Hayek in 2009 and the couple have a daughter.
“In my opinion, this is more of a personal investment by the Pinault family than anything related to Kering or the luxury business,” says Luca Solca, an analyst at Bernstein. “Salma Hayek is a movie star of the first tier, aware of what is happening in Hollywood.”
Pinault's business is expanding into the media sector. Earlier this year, Kering-owned Saint Laurent launched a film production company and debuted at the Cannes Film Festival with its first film, directed by acclaimed director Pedro Almodóvar.
The French fashion house's artistic director Anthony Vaccarello said the new division gave him «the opportunity to expand my vision of Saint Laurent with a medium that is more durable than clothing.»
For Kering, this attempt by Pinault CAA could help boost his fortune. For years, it has been losing ground to arch-rival LVMH, which owns Louis Vuitton, Dior, Tiffany and many other luxury brands.
Earlier this year, LVMH became the first European company worth more than $500 billion ($3,400 billion). pounds sterling) after a boom in sales of its brands.
Kering is struggling to keep up with the times. Its most important brand, Gucci, increased sales by just 1 percent last year. The company has recently been at the center of an activist campaign calling for a shake-up and revived growth.
Kering is likely to again «significantly underperform the luxury sector» this year, analysts said. Morgan Stanley said.
The Artémis deal with CAA could offer a new way to refresh and revitalize Kering's brands. The group's Paris-listed shares rose more than 1 percent on Friday.
The background to the takeover was unrest in Hollywood. Earlier this summer, members of the Writers Guild of America and the actors' union SAG-AFTRA went on strike, delaying the production of numerous TV series and films.
The industry dispute, which arose over concerns about the replacement of artificial intelligence for both actors and writers, This hurts both studios and talent agencies.
Endeavor, a rival agency headed by Ari Emanuel, the inspiration for the character Ari Gold on the TV show Entourage, said earlier this summer that the strikes would cost it $25 million a month.
The company's shares have fallen by about 15% since the spring. Meanwhile, CAA was forced to let go of 60 people last month.
This development raises the possibility that Artemis may have simply snatched a good deal. After all, Pinault's father, Francois Pinault, built the family empire by buying up struggling companies.
His penchant for distressed assets led him to be called a «pirate» by a leading French journalist.
Francois-Henri Pinault's foray into Hollywood comes amid strikes in the entertainment industry there. Photo: David Livingston/Getty Images
Whatever the price — and whatever the motives — the CAA deal leaves Pinault open to accusations of conflict of interest.
< p>Controlling companies that represent celebrities and the brands they sign advertising deals with are not the best option.
Situations like this are not unusual in Hollywood, however, as Ovitz insisted in the early 1990s. when he faced criticism for advising a movie studio and clients who sought work there.
“This industry invented conflicts of interest,” Ovitz, who took over Disney after leaving CAA, told Time magazine in 1993. «Everyone does business with everyone else.»
Pino will no doubt be hoping his latest deal means he'll simply get more business.
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