Hermès and Exor spent 15 years building a Chinese luxury brand, then wrote it off

Shang Xia was launched in 2010 by Hermès together with Chinese designer Jiang Qiong Er, on a thesis no other European luxury house had tried at scale: build a genuinely Chinese luxury brand — furniture, tea, homeware, then fashion — rather than sell European heritage to Chinese buyers. Hermès held the founding stake and carried the brand through its first decade.

On 9 December 2020, Exor — the Agnelli family holding company — invested roughly €80 million through a reserved capital increase and became majority shareholder at 82.3% of economic and voting rights, with Hermès staying on as a minority. Hermès booked a non-recurring profit of around €80 million on the sale, and Exor framed the deal as taking Shang Xia 'to the next stage of its development'.

The next stage was the write-off. In its audited 2023 accounts, Exor marked the carrying value of its Shang Xia equity to €0, down from €67 million a year earlier, citing 'the company's poor performance and the uncertain outlook for China's macroeconomic environment' and a sales decline it described as double-digit. The 2024 accounts then fully wrote off a shareholder loan to the holding company — principal HKD 836 million, €118 million including interest — with Exor's stated reason that there was 'limited visibility on future cash generation'.

Exor's 2024 letter to shareholders reports that Shang Xia cut operating costs by close to 55% and halved its operating losses against 2023 on flat revenue — still loss-making, with the China luxury market down about 20% that year. The brand continues to trade, but Exor's own filings record the equity stake and the loan as worth nothing.