LVMH close to sponsorship deal for range of luxury brands in F1

LVMH is in final stages of talks to become a major sponsor of Formula One, in a deal that would allow the French luxury conglomerate to promote its top brands on the racetrack.

The Paris-based company is close to a deal under which watchmaker Tag Heuer, as well as other brands that could include Moet & Chandon champagne and possibly its hotel chains, will become F1 sponsors with logos and branded merchandise prominently displayed for race spectators, according to people familiar with the matter.

The potential deal could be worth $150 million a year and would be a coup for Rolex SA, the leading Swiss watch brand that has been F1's timing sponsor since 2013.

Talks are ongoing and no final agreement has been reached, said the people, who spoke on condition of anonymity because the discussions are private.

Representatives for Formula One and Rolex declined to comment. Representatives for LVMH did not immediately respond when asked for comment.

F1's popularity has skyrocketed in recent years, fueled by an expansion in racing venues and in part by the Netflix series 'Formula 1: Drive to Survive'.

The potential F1 deal would provide a broad global platform for several LVMH brands, boosting the commercial and marketing ambitions of company founder and controlling shareholder Bernard Arnault, who has built the world's largest luxury company through a series of acquisitions.

LVMH’s Louis Vuitton and the Tiffany & Co. jewellery brand regularly appear at global sporting events, notably with the FIFA World Cup display cases or NFL trophies. Louis Vuitton has produced famous advertising campaigns with footballers Cristiano Ronaldo and Lionel Messi, as well as tennis players Rafael Nadal and Roger Federer, photographed by photographer Annie Leibovitz.

LVMH was one of the main sponsors of the Olympic and Paralympic Games held in Paris over the summer, providing financial support worth 150 million euros ($166 million). Its brands featured prominently throughout the competition. Superstar Celine Dion, in particular, wore a shimmering white silk Christian Dior dress when she sang from the Eiffel Tower at the end of the Olympic opening ceremony in late July.

The French conglomerate's numerous luxury brands are giving it an advantage in negotiating a potential multi-brand deal with F1 over Rolex, which only makes watches, the people said.

If a deal is reached, the LVMH agreement could be announced before the end of the year and the start of the F1 season. LVMH Chief Financial Officer Jean-Jacques Guiony confirmed during a conference call with analysts and investors in July that the company was in talks with Formula One, but said at the time that “nothing had been decided.”