Hedge funds have ramped up short bets against Kering to their highest levels in more than a decade, adding to the challenges facing incoming chief executive Luca de Meo as he looks to turn around the French luxury group, according to a report by Reuters.
Data from analytics firm ORTEX shows short positions peaked at 10.7% of Kering’s free float in June, immediately after the former Renault boss was named CEO. Though those bets have since eased to around 8% of free float, they remain significantly higher than levels seen for rivals LVMH and Hermès, both under 1%.
The heightened bearish positioning has been accompanied by a spike in Kering’s credit default swaps, which surged to their highest since 2013 amid investor scrutiny of the group’s €10.5bn net debt and slowing sales at Gucci and Saint Laurent. While the CDS spreads have moderated, they remain well above sector peers.
De Meo formally takes over this week, with investors awaiting details of his strategic vision. The company has already pledged store closures and real estate disposals to strengthen its balance sheet, while signalling a longer-term overhaul of Gucci. Trademark filings for “Conkering” and “Reconkering” hint at a branding reset under his leadership.
