Set in Stone: The Story of Richemont
The story of what would eventually become Richemont began in a world far from luxury. Anton Rupert built a cigarette business in South Africa during the 1940s, which by the 1990s had become one of the largest cigarette producers globally. But a small investment in Cartier in the early 1970s would set Richemont on a new course. What followed was improbable. A South African tobacco group ended up owning some of the most prestigious brands in jewelry and watchmaking, then spent the next decades acquiring and growing its maisons into the world's leading hard luxury group.
A garage in Johannesburg
The first protagonist in the story is not Johann Rupert, who founded Richemont in 1988, but his father, Anton Edward Rupert. Born in 1916 in the small town of Graaf-Reinet in South Africa, Rupert enrolled at the University of Pretoria to study medicine. After switching degrees to chemistry, he graduated in 1939 and worked as a lecturer for a brief period before opening a dry cleaning business, a venture he soon abandoned.
Having grown up during the Great Depression, Anton Rupert carried with him an observation shaped by the tough years: even at the worst point of the crisis, people never stopped buying tobacco and alcohol. In 1941, with an initial £10 and the help of two co-investors, he started the tobacco company Voorbrand out of his garage.
The company struggled at first, but momentum began to build after Rupert relocated to an old flour mill in Paarl, near Cape Town, and renamed the business Rembrandt Tobacco Corporation. In 1948, he struck a licensing deal with Rothmans, a British cigarette manufacturer. The agreement allowed Rupert to manufacture and sell cigarettes under the Pall Mall and Consulate brands. The major breakthrough came in 1952, when he invented the king-size filter-tip cigarette, which became such a success that in 1953, with the help of a national insurance company, he acquired a controlling interest in Rothmans for around £750,000.
In the following decades, Rembrandt diversified across South African industries, ventured into wine and spirits, banking and financial services, mining, printing and packaging, all while acquiring tobacco brands across Europe. In 1972, the company consolidated its overseas tobacco operations into Rothmans International and listed on the London Stock Exchange. By the mid-1990s, the group was one of the largest cigarette producers in the world, ranking among the top four globally, alongside Philip Morris, British American Tobacco (BAT), and RJR Nabisco.
Yet the story of how the tobacco conglomerate became a luxury group began far from South Africa. A century earlier, in Paris, a small jewelry house was beginning a journey that would eventually reshape the company's identity and become Rupert's most valuable asset.
Cartier enters the picture
Cartier was founded in 1847, when a 27-year-old Parisian watchmaker named Louis-François Cartier took over the workshop of his instructor, Adolphe Picard. The earliest years were relatively unassuming, but the firm reached an important moment in 1856, when Princess Mathilde Bonaparte became a customer.
Over the next half-century, the business passed down within the family, with one of Louis-François Cartier's three grandsons, Louis Cartier, designing some of the pieces that still define the firm's identity today: the Santos and Tank wristwatches, among the very first wristwatches designed for men, and the Panthère motif, introduced in the 1910s. The latter would become the house's defining animal emblem.
Around the turn of the 20th century, the three Cartier grandsons moved the store to Rue de la Paix, the prestigious jewelry street leading into Place Vendôme, before expanding to London and New York. The new London branch coincided with a commission to create 27 tiaras for the 1902 coronation of King Edward VII. The commission proved decisive: Cartier was soon appointed royal supplier to the British court, and its reputation soon spread through Europe's aristocratic and royal circles.
Hocq and the cigarette deal
By 1964, all three Cartier brothers had passed away. Their children continued to run the separate branches independently, but over the years, operations gradually drifted apart. During the same time, a French entrepreneur named Robert Hocq had built the lighter manufacturer Silver Match into one of the world's leading producers and wanted to launch a luxury gas lighter under a recognizable jewelry name.
Having had his proposal rejected by Van Cleef & Arpels, he turned to Cartier, which agreed to a partnership. In 1968, the collaboration produced the first Cartier-branded lighter, sold as a luxury accessory, and by the early 1970s, Silver Match was shipping hundreds of thousands of Cartier lighters a year. The success, combined with the realization that the Cartier branches operated independently with no single owner, gave Hocq an idea.
Together with the consortium leader Joseph Kanoui, Hocq acquired Cartier Paris, the founding branch, in 1972. The following year, the company launched the famous "Les Must de Cartier" concept, later extending the brand into a range of accessories: pens, watches, and leather goods that were sold at a premium thanks to the Cartier name. It became a huge success. A few years later, the brand added London and New York and, in 1979, merged the three operations into Cartier Monde, with Hocq as president.
This is where the two stories intertwine. Among the consortium's backers was Anton Rupert, and he stood out from the other investors because he had something none of them could offer: a global tobacco network. Rather than join as a passive financial backer, Rupert negotiated structured terms, taking a 20% stake in Cartier New York and, in return, receiving a license to use the Cartier name on Rembrandt's cigarettes, which would later be folded into the Les Must de Cartier range. The deal introduced Rupert to the world of luxury.
But then, in December 1979, just months after the merger had been finalized, Hocq was struck by a car in Paris and died. After Hocq's death, Rupert bought additional shares in Cartier Monde and became the majority owner. The Cartier family had sold the brand to a consortium, the consortium's founder unexpectedly and tragically passed away, and all of a sudden, a South African tobacco group was in control of one of the world's most famous jewelers.
Founding Richemont
By the mid-1980s, international sanctions against South Africa were tightening as a direct result of the government's refusal to give up the policy of apartheid. The Rembrandt Group's international assets, Rothmans International, the Cartier stake, and a growing portfolio of luxury and consumer investments were at risk of being caught up in the sanctions. Rupert needed to insulate the international business from the South African operations, which meant finding someone capable of managing the spin-off.
That someone was Anton's eldest son, Johann Rupert. After studying economics and company law at Stellenbosch, he worked at Chase Manhattan (now part of JPMorgan Chase) and Lazard in New York during the mid-to-late 1970s. In 1979, he returned to South Africa to found Rand Merchant Bank, and in 1985, at the age of 35, he joined Rembrandt.
One company would retain Rembrandt's South African interests (tobacco, financial services, mining, wine, and spirits) and would be renamed Remgro. The other would hold all international assets, including Rothmans International, Cartier Monde (which, by then, also included Piaget and Baume & Mercier), and Alfred Dunhill (home to Montblanc and Chloé).
In 1988, the spin-off was completed. The new international group became Compagnie Financière Richemont SA, based in Switzerland and listed on the Swiss and Johannesburg stock exchanges, with Johann Rupert as Chief Executive Officer.
From day one, the company carried a dual-class structure. The Rupert family held unlisted B-shares carrying disproportionate voting rights, while the publicly listed A-shares had less voting power. That setup has continued, and today the family owns roughly 9-10% of the equity but controls around 51% of the votes. It has allowed the company to think in decades rather than quarters, and is something we'll return to later.
From conglomerate to luxury group
Still controlling one of the world's largest tobacco companies, the Richemont that emerged in 1988, was not yet the luxury group it would later become. Johann Rupert would spend the next decade reshaping that portfolio.
The first move was structural, gathering its tobacco interests under Rothmans International and its luxury holdings into a newly created company called the Vendôme Luxury Group. Richemont then bought out the minority shareholders of Rothmans International in 1995, taking full control of the business.
A few years later, in 1999, the group merged Rothmans International with BAT, creating what was then the world's second-largest tobacco company, with Richemont receiving a 23.3% equity stake in the combined entity. The divestment more than halved the group's revenue, but it marked a turning point in the company's strategy, finalizing its operational exit from the tobacco industry.
In 1998, it also bought out Vendôme's minority shareholders and took its luxury subsidiary fully private. During this period, the company made several acquisitions that now make up a core part of Richemont's offerings. In 1996, the company acquired Vacheron Constantin, one of the oldest continuously operating watchmakers in the world, founded in 1755. In 1997, it added Officine Panerai, the Italian watchmaker, and Lancel, the French leather goods house. However, the most notable acquisition during this period was the purchase of Van Cleef & Arpels.
The jewelry house was founded in 1906 by Alfred Van Cleef and his brothers-in-law Charles, Julien, and Louis Arpels. The company opened its first boutique at 22 Place Vendôme in Paris and became famous for its patented Mystery Set technique, in which gemstones appear to float with no visible metalwork.
Richemont acquired a 60% stake in 1999 in a transaction that valued Van Cleef & Arpels at around CHF 460 million, equivalent to roughly 6% of the group's total market capitalization at the time, a figure that would have been significantly higher, excluding the tobacco business. By 2001, it had increased its position to 80%, and later reached full ownership in 2003.
Inside Vendôme, Cartier still carried the legacy of the Hocq era. While “Les Must de Cartier” had been a commercial success and had attracted a new generation of customers over the past decades, there was growing internal concern that it also risked undermining Cartier's exclusive, high-end positioning. The reassertion of that positioning would unfold over the coming years.
Rupert was not building a broad luxury conglomerate like Arnault's LVMH or Pinault's PPR (later renamed Kering). Richemont's strategy focuses primarily on hard luxury: watches and fine jewelry.
The next acquisition would further expand the group's second segment, following the largest hostile takeover in corporate history.
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The watchmaking battle
In February 2000, the British telecommunications group Vodafone AirTouch completed its acquisition of Germany's Mannesmann AG in a deal valued at more than $180 billion. Inside Mannesmann's portfolio, alongside cellular networks and industrial assets, sat a watchmaking holding company called Les Manufactures Horlogères, or LMH. It owned three historic watch manufacturers: 60% of Jaeger-LeCoultre, 90% of A. Lange & Söhne and 100% of IWC Schaffhausen.
Vodafone's interest in Mannesmann was never driven by these assets, and it quickly signaled that they were available for sale. Every major luxury player was interested: LVMH, the Gucci Group (then still separately listed but backed by PPR), the Swatch Group, and, of course, Richemont.
After a few intense months, Richemont came out the winner, but the route there took the form of a separate bilateral transaction outside the LMH sale process. Audemars Piguet owned the remaining 40% of Jaeger-LeCoultre, and in the weeks leading up to the LMH auction, Richemont negotiated separately with Audemars Piguet to acquire that stake and decisively reached an agreement.
Richemont could therefore offer a deal that would give it 100% ownership of Jaeger-LeCoultre, an outcome no rival bid could match, leading to exclusive talks with LMH. The deal closed in 2000 at CHF 2.8 billion for LMH itself, plus the CHF 280 million already committed to Audemars Piguet. Richemont paid fully in cash, drawing on the sale of BAT preference shares as well as proceeds from earlier divestments.
The Richemont of the early 2000s
In the early 2000s, Richemont's Jewellery Maisons, led by Cartier, represented more than half of the revenue, followed by Specialist Watchmakers at roughly a third. The remaining 12% consisted of brands focused on textile, leather, and other consumer goods.
The company's 18.6% equity stake in BAT remained on the balance sheet until 2008, when Richemont distributed it to its shareholders, cutting all its tobacco ties at last. Though we have thus far outlined a string of well-executed and strategic acquisitions, these years would also see a costly misstep, one that was intended to make Richemont the leader in luxury e-commerce.
The online luxury misadventure
In 2002, Richemont participated in a small funding round for Net-a-Porter, a two-year-old London company founded by former fashion journalist Natalie Massenet. The Swiss group acquired a majority stake in the business in 2010 and, five years later, merged it with the Italian Yoox Group. The transaction valued the combined entity, YNAP, at around €3 billion, with Richemont taking a 49% economic stake, though with only a 25% voting share. The merger created one of the world's largest online luxury retailers and was intended to deliver economies of scale across the combined business.
In 2018, Richemont doubled down, increasing its stake to just above 95%, valuing the growing and profitable YNAP at €5.3 billion. The acquisition strengthened Richemont's online presence, giving it control of an established e-commerce platform rather than requiring it to build one internally. The online luxury sector was expanding rapidly and was widely expected to continue on that trajectory, but this narrative would quickly change.
Following the full takeover, YNAP moved quickly into loss-making territory. A costly technology and logistics overhaul weighed heavily on the business, customer acquisition costs were high, and luxury demand was slowing. Brands were also increasingly pulling back from wholesale and shifting sales to their own direct-to-client platforms to control the customer journey, a trend accelerated by the pandemic. It was not only YNAP that was affected, but the sector as a whole.
In August 2022, Richemont announced it would sell a 47.5% stake in YNAP to Farfetch to offload its troubled e-commerce business, taking a €3.4 billion writedown on the investment. Regulatory clearance came in late 2023, but soon after, Farfetch announced it was being acquired by South Korean e-commerce group Coupang, and the YNAP deal was terminated.
It was not until October 2024 that Richemont found a new buyer and agreed to sell YNAP to Mytheresa (now LuxExperience). The transfer included €555 million in cash and no debt, in exchange for a 36% equity stake in Mytheresa. The deal closed in April 2025, with a write-down of almost €1 billion, bringing cumulative writedowns to at least €5 billion.
The YNAP chapter certainly had its lessons. Investing in a luxury e-commerce platform and becoming a dominant player in the niche definitely sounds more reasonable than what it has turned out to be. However, the platform model required luxury brands to cede control over their customer experience and distribution. When that control was tightened, something Richemont itself embodied, the model struggled.
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