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Hermès Family Back in Saddle
With LVMH Hovering, Luxury-Goods Maker Picks Axel Dumas to Succeed Patrick Thomas as CEO
PARIS—The founding family of French luxury-goods maker Hermès International RMS.FR -1.03% SCA Tuesday named a member of its sixth generation to become chief executive next year, cementing its grip as the threat lingers from larger rival LVMH Moët Hennessy Louis Vuitton.
Hermès, the 175-year-old maker of Kelly bags, horse saddles and equestrian-themed silk scarves, said Axel Dumas, the 42-year-old chief operating officer, will take over from Chief Executive Patrick Thomas, who will be 65 in a few weeks. In a lengthy transition, Mr. Dumas, a descendant of founder Thierry Hermès, will become joint-CEO alongside Mr. Thomas at the end of May 2013 and will assume full managerial control at a later unspecified date.
The change in management returns the reins of the company to the family, which in 2010 had a backseat role before an unfolding drama with LVMH.
Two years ago, LVMH, the holding company for brands including Louis Vuitton, Fendi, Marc Jacobs and Donna Karan, stealthily began building up a 22% stake in Hermès, swallowing up the majority of the shares of Hermès that are in the hands of the general public.
Faced with what Mr. Thomas called "an intruder in our garden," the Hermès family closed ranks, but not before the market speculated that some family members would sell at the right price.
Although LVMH insisted that its intentions were friendly and it didn't plan a takeover, the Hermès family interpreted the stake buildup as an assault on its family unity—only a few months after the death of the family's patriarch, Jean-Louis Dumas.
Analysts questioned whether the members of the sixth generation would fill the gaps being vacated by the fifth generation. At the time of Mr. Dumas's death, there was no family succession plan in place, and little had been done to identify likely contenders.
The first nonfamily member to run Hermès, Mr. Thomas, who has been boss since 2006, guided the company through its standoff with LVMH. Yet the avuncular boss was seen by many family members as a surrogate member of the clan.
The younger Mr. Dumas emerged as the most likely successor to Mr. Thomas over the past year, since he was named chief operating officer. The dark-haired manager, who started his career as a banker in New York and China, entered the family business in 2003, working in various divisions, such as jewelry and leather goods.
Though LVMH remains a major shareholder, the Hermès family feels that it has won the battle for now. Last year, dozens of Hermès family members locked up shares representing just over half the capital in a new holding company, with the intent to keep them out of LVMH's hands for at least 20 years.
"I am glad a member of the Hermès family has been brought in to succeed me," Mr. Thomas said in a prepared statement Tuesday.
"In 15 days' time I will be 65 years old... for some time I have been preparing my succession," Mr. Thomas said at the company's annual shareholders meeting Tuesday.
Several of Mr. Dumas's cousins have joined the company or been promoted to senior positions since LVMH's arrival. Of the roughly 40 members of the sixth generation, about 10 work in the family business. Julie Guerrand quit her banking job with Rothschild last year to become the director of corporate development. Eric de Seynes became the president of the supervisory board.
They will now be joined by one more. Henri-Louis Bauer will replace his uncle, Bertrand Puech, on July 1 as the top manager of Emile Hermès SARL, the limited partnership that controls the company and which is open only to direct Hermès descendants.
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for the article, Audreylita.
Change is inevitable and with Hermes, it has changed a lot over the years and may change more in the future. I've been supporting Hermes for many years and many here would agree Hermes is no longer what it used to be in the last course of 20 years. 
