Leicas are fashion accessories-its official !

The high fashion group Hermes SA, which sells scarves, ties and the $8000 Kelly handbag (named after the late Grace Kelly) will buy a 30% stake in Leica Camera. The reason, admits Leica's spokesperson, is that Hermes is much better at marketing luxury goods... Read newsreport below.

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Hermes Offers to Buy 30% of Leica Camera for EU17 Mln (Update1)

11/20/0 4:55 (New York)

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Solms, Germany, Nov. 20 (Bloomberg) -- Hermes International

SCA, France's third-biggest luxury goods maker, offered to buy 30

percent of Leica Camera AG, a German maker of luxury cameras, for

about 17 million euros ($14 million).

Hermes offered Leica shareholders 12.50 euros per share, 27

percent more than Friday's close. Holders can take up the offer

between Nov. 22 and Dec. 20, Leica spokesman Gero Furchheim said

in a telephone interview..

Unlike rivals Cie. Financiere Richemont AG and LVMH Moet

Hennessy Louis Vuitton SA, Hermes hasn't acquired luxury

watchmakers or clothing makers to boost sales.

``For us, it's important to find a partner who has a first-

class knowledge of distributing luxury products,'' Furchheim said.

He said it's too early to say what the partnership will look like.

Shares in Paris-based Hermes rose as much as 1.5 euros, or

0.86 percent, to 175 euros. Leica's shares are suspended for the

day. They rose 3.1 percent, to 9.85 euros Friday.

Leica's management board sees the price as ``fair'' and

recommends stockholders take up the offer, the German company said

in a statement on the Frankfurt stock exchange news wire.

More than 80 percent of Leica's shares are publicly traded.

Lancet NV Holding owns 13.6 percent and Deutsche Steinzeug AG has

a 5.3 percent stake in Leica.

Leica said its first-half loss widened to 6.7 million

deutsche marks in the six months ended Sept. 30 from 4.6 million

marks a year earlier, in part because of the euro's weakness.

The company said it expects to post a profit for the full

year as sales pick up in the second half. Sales rose 16 percent to

141 million marks in the first six months of fiscal 2001.

OK:

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You have been ignoring this post for a while. Consider:

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<b> <FONT COLOR="red"> Hermes International SCA, France's

third-biggest luxury goods maker, offered to buy 30 percent of

Leica Camera AG, a German maker of luxury cameras,</FONT>

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What the hell is a luxury camera?

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Art

It the Hermes deal goes thru, it will be a good thing for Leica, which needs

new financial backing by some one with deep pocket. It is hard to compete alone in today's very competitive camera market. Nikon has ghe backing of giant Mitsubishi, Rollei has the backing of Samsung of Korea ..

Hermes has world wide distribution network around the globe, which will help to boost sales of Leica cameras.

As for "fashion accesory" that may not fit Leica; just as Mont Blanc pens, Rolex watches are not just accesories.

I can foresee that the price of Leica camera will increase quite rapidly down the road.

A financial injection can be a good thing, or it can be stifling. If

Leica Camera can remain somewhat autonomous, doing what they do best,

without having to justify every move, it would be good. If the shift

goes from the "bread and butter" real world cameras and lenses for

real world USERS to "limited edition" this or "commemorative model"

that... for COLLECTORS... then we, as users, should start hording now.

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I don't need pretty, fancy or 1 of 2000. I just want conservative

metal and glass that works. If it breaks, I want to be able to go

buy another... longevity of the line up.

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Let's hope the reason for the merger is because Hermes is owned by

Leica photographers that have an interest in the Line from a

historical perspective, and will let it thrive with the influx of

cash. But a hyphenated "Leica-Hermes" red dot on my new camera would

make me go back and review that "what tape should I use...?" thread.

I worry a little about this too in that Hermes know nothing about

optics or cameras, but they do know about selling and marketing

luxury goods, and Leica sorely needs some good marketing. If they can

increase their sales to the "Rolex wearing class" then this seems a

good fit. The worry has to be that the Leica is special and cannot be

mucked about with that much or it will die swiftly. So I think a

cautious voter in its favor, although I am sure many of us will hate

the resulting advertisements and tie-ins.