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French luxury group LVMH has signed on as a partner for the 2024 Paris Olympic Games, a last-minute deal that will help event organizers bridge a budget gap after increasing costs.
The Louis Vuitton owner did not disclose the value of the agreement, but it is worth around 150 million euros, a person familiar with the matter said.
The support, one of several high-profile sponsorships aimed at securing funding for the event, comes as relief for the Games, which will take place between July 26 and August 11 next year.
Organizers have pledged to keep taxpayer funding for the event to a minimum and rely instead on private backers, but a 10 percent increase in their operating budget to €4.4 billion at the end of last year has added to funding problems.
Corporate sponsors have been late in signing up for the Paris Olympics and Paralympics compared to previous editions elsewhere, with Covid-19 pandemic decisions being delayed. Some backers, such as Carrefour, have done so partly “in kind”, and the supermarket set package will include the provision of fresh fruit to athletes.
This is the first time that LVMH, Europe’s largest company by market capitalization, is a group-wide sponsor. Controlled by the family of billionaire Bernard Arnault, the company usually makes such deals individually within its stable of 75 brands: Vuitton supports the 2023 Rugby World Cup in France, while Christian Dior designs uniforms for footballers in Paris Saint-Germain.
At the Olympics, LVMH Chaumet jewelry will design the medals, beauty stores Sephora will be a partner in the Olympic torch relay and champagne brand Moët Hennessy will provide the hospitality venues. One of its luxury brands is expected to dress French athletes.
Arnault, CEO of LVMH, said: “Naturally, LVMH and LVMH homes He will be part of this extraordinary international event.”
The total cost of the Paris Games is now estimated at €8.8 billion when the budget for infrastructure and construction projects such as the Olympic Village is taken into account. That compares to an estimate of €6.6 billion in 2017, with inflation added to the bill.
France’s national auditing body, the Cour des Comptes, said in a June report that the complexity of the project had been underestimated financially from the outset, and warned that the budget would remain very tight.
“It provides very little wiggle room,” said the auditor.
Within the organizers’ €4.4 billion operating budget – which was expanded by €400 million in December 2022 – roughly a third is supposed to come from ticket sales and hospitality, with the remainder split between sponsors and funding from the IOC.
Ticket prices running into the hundreds of euros for some events caused an outcry when they went on sale earlier this year, including among athletes.
The person close to the talks with LVMH said: “It is not difficult to speculate about the contribution of LVMH, it is mainly the remaining budget deficit of the committee.”
Other big French sponsors include energy group EDF and telecoms company Orange.
Tony Estanget, president of the Paris 2024 organizing committee, told reporters last week that the budget was under control, and that the target of signing 92 percent of planned partnerships by the end of the year was on track.
The Paris Olympics continues to have huge public support despite controversy over ticket prices and a police search of the committee’s headquarters in June as part of a corruption investigation. According to a recent Harris Interactive poll commissioned by the organizers, the event had broad support from 72 percent of people in July, although that’s down from 84 percent three years ago.