Jay-Z Partners With LVMH In 50/50 Champagne Deal

Jay-Z and LVMH Moët Hennessy Louis Vuitton SE join forces in the Champagne industry, confirming the alliance between the world of hip-hop and luxury as the Covid-19 pandemic reduced sales of the festive wine world-wide.

LVMH has a 50% stake in the high-end brand Armand de Brignac, which Jay-Z owns. The brand, known for its expensive metallic bottles, is the youngest in the famed sparkling wine region.

LVMH and Jay-Z said that the investment is intended to expand Armand de Brignac through the global distribution networks of LVMH while drawing on the vast resources of the conglomerate within the Champagne wine country. It comes at a tough time for Champagne since the pandemic has canceled weddings, soirees, and other occasions were popping the cork is known, with wine sales declining by about 20% last year.

During an interview, Jay-Z said, “We were working really hard to maintain a brand that was growing faster than the staff we had and bigger than some of the expertise we had.” He explained, “We’d been in this 15 years, not a hundred.”

The collaboration highlights how European luxury labels are now adopting black music artists and hip-hop culture to cater to a younger, more diverse clientele. Streetwear has become a luxury lifestyle staple; for example, Fenty Beauty, a cosmetic line unveiled by Rihanna and LVMH, rapper Gucci Mane and the Italian fashion house Gucci have collaborated on a line, and Dior, a brand of LVMH, has used rapper A$AP Rocky in many menswear collections as a featured model.

“I think that people have come to accept that these two worlds are a natural fit,” Jay-Z said. “In the beginning, it wasn’t a natural fit.”

Rappers have since referenced name brands like Dior, Louis Vuitton, Dom Pérignon, and other labels in their lyrics. But until recently, the luxury industry kept its hip-hop followers at a distance. Jay-Z was pushed by one such perceived snub to invest in Armand de Brignac.

The Brooklyn-born rapper had been a devotee of Cristal since emerging as a star in the 1990s, repetitively name-dropping the high-end Champagne brand in his rhymes. That changed when an executive at the parent company of Cristal was asked in The Economist in 2006 if its association with rap would harm the brand. “That’s a good question, but what can we do?” he replied. Shortly after, Jay-z organized a boycott of Cristal.

Later in 2006, he promoted a new brand: Armand de Brignac, which called itself ‘Ace of Spades’ In the video for the single ‘Show Me What You Got,’ and was released earlier that year in the Champagne town of Chigny-les-Roses. The brand immediately released a press release highlighting the reference.

Jay-Z was one of Armand de Brignac’s earlier investors, and in 2014 he bought out his partner, Sovereign Brands, a spirits business.

The deal emerged from negotiations between Jay-Z and Alexandre Arnault, the 28-year-old son of Bernard Arnault, French billionaire, and the chief executive and controlling shareholder of LVMH. Jay-Z said he first met Alexandre on a trip with Kanye West in Paris. After Bernard and Alexandre, and Mr. Schaus met with Jay-Z several times at his Los Angeles home, the deal progressed further.

Jay-Z said that he plans to work with LVMH on other projects. For rappers, he said, the allure of luxury derives from the need to rejoice after overcoming the inner city’s poverty.

“If you put yourself in the shoes of people who come from these neighborhoods, you can understand why someone who — five of their six friends have passed away — would want to celebrate life,” Jay-Z said. “We’re connecting with things that are well made and things that survive.”