PARIS — Hermès, the French luxury firm, said it would buy 25 percent of high-end Swiss movements maker Vaucher Manufacture Fleurier for 25 million Swiss francs, or $19.7 million at current exchange.
The purchase will be conducted via two capital increases, according to Guillaume de Seynes, Hermès’ assistant managing director and president of the watch division.
Seynes said the deal buoys Hermès’ position in the fast-growing mechanical segment while opening the door for the company to increase the number of expensive complicated mechanical watches it sells.
Hermès introduced its first mechanical watch with a Vaucher movement — Dressage — in 2003. The watch can cost as much as 25,000 euros, or $31,275. An introductory Hermès quartz watch costs about 1,200 euros, or $1,500.
“The high-end mechanical segment has been growing fast industry-wide,” said Seynes.
He said expensive mechanical watches make up about 5 percent of Hermès’ total watch sales, which grew 4 percent to 104 million euros, or $130.1 million, in 2005.
Vaucher, which is based in Fleurier, Switzerland, is known for its high-precision movements that are used by the likes of Tiffany and Corum. It is owned by the Sandoz Family Foundation, which also holds, with Michel Parmigiani, the Parmigiani Fleurier luxury watch brand.
Seynes said Vaucher would continue to work with all of its existing clients. The deal does not bring Hermès into Parmigiani’s capital structure.