When asked by the Financial Times last night how much money LVMH has spent to acquire 60% of Off-White from Virgil Abloh, its CEO Michael Burke replied: “We paid the right amount.” Even when done so discreetly, money always talks. However what’s much more interesting to everyone but Abloh’s accountant is not how much LVMH has paid, but what exactly it is that LVMH has purchased—and what that means for everyone involved.
First and foremost: What LVMH has not purchased is the tangible day-to-day operations of Off-White. To understand why, you have to look back to 2012 or so when, the story goes, Abloh was in a club and fell into a conversation with his fellow DJ Marcelo Burlon. Abloh told Burlon about his plans for a brand named Off-White that would succeed his previous guerrilla upcycling project, Pyrex Vision. Burlon directed Abloh to Claudio Antonioli and Davide De Giglio, the partners who were helping him develop County of Milan with great success, and Abloh duly struck a deal to produce Off-White with the men in Milan. By January 2014, the first Off-White collection was ready for launch at Paris menswear, and it was successful from the get-go. In 2015, the same year Off-White was nominated for the LVMH Prize (alongside Vetements, Abloh was pipped to the post by Marques ’ Almeida) Burlon, Antonioli, and De Giglio formed New Guards Group as the parent company of County, Off-White, and its various other operated brands.
Today, however, the ultimate owner of Off-White’s physical operations is Farfetch, the e-tailer, which purchased New Guards from the founding trio in August 2019 for a cool $675 million. My excellent former Style.com colleague Matthew Schneier got the exclusive story on the formation of Off-White back in December 2013 in which Abloh told him: “Streetwear has a one-trick-ponyness to it. I want to give my point of view and merge street sensibilities in a proper fashion context. I think that if I can merge the two, it’ll make something interesting.”
So LVMH has not bought the body of Off-White, because unlike, say Ermenegildo Zegna (which is preparing to go public), Off-White is not vertically integrated. Instead, it’s purchased something of potentially far greater value: a significant stake-holding in the brain of Off-White. LVMH has paid an untold sum to purchase Off-White LLC. This is the Limited Liability Company through which Abloh conducts his personal business operations. It is also, presumably, the holder of the IP pertaining to the trademark and copyright of Off-White.