By Tassilo Hummel and Mimosa Spencer
PARIS (Reuters) -Shares in Kering rose in early trading on Monday while stocks in Renault fell after reports the French carmaker’s CEO Luca de Meo was poised to become the new chief executive of the luxury goods maker.
Kering shares gained around 5% on trading platform Tradegate by 0606 GMT and Renault shares fell around 3%. De Meo will leave Renault in mid-July for a new role outside the auto industry, Renault said late on Sunday.
De Meo turned around the troubled French automaker in his five years at the helm, overhauling its two-decade-long strategic alliance with Nissan and doubling down on hybrid motors while shifting towards electric vehicles.
The Italian is set to replace Kering CEO Francois-Henri Pinault, whose family controls the heavily indebted luxury conglomerate and who has been leading it for 20 years, Le Figaro newspaper first reported.
Le Monde newspaper said, without citing sources, that Kering was expected to announce de Meo’s appointment after the market close on Monday.
Kering declined to comment on these reports.
“Luca de Meo has expressed his decision to step down in order to take on new challenges outside the automobile sector,” Renault said in a statement late on Sunday.
The French state holds a 15% stake in Renault.
If confirmed, de Meo’s move to Kering, which has lately failed to convince stock market investors of its plans to turn around its Gucci label, would mark a dramatic change at the group. Pinault would remain Kering’s chairman.
“Brand management and marketing are his forte,” Luca Solca, analyst at Bernstein said of de Meo, “which dovetails with what the luxury industry does – for which he seems passionate.”
“It is not hard to imagine how intriguing he
found the Kering opportunity.”
De Meo joined Renault from Volkswagen in 2020, a year when the French carmaker reported record losses after a pandemic-induced hit to sales.
In the years since, De Meo launched wide-ranging cost cuts that sharply reduced headcount and production capacity worldwide and turned the firm into a smaller but nimbler company. He also oversaw a vast reshaping of Renault’s decades-old, but often difficult, relationship with Japan’s Nissan.
“De Meo is perceived to have largely contributed to Renault’s turnaround through product newness, technological innovation, EV transition shift, brand elevation, and a return to growth and profit,” Citi analysts wrote.
(Additional reporting by Gilles Guillaume in Paris, Danilo Masoni in Milan; Writing by Ingrid Melander; Editing by Richard Lough)
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