France's public prosecutor has opened a judicial inquiry into luxury firm LVMH's acquisition of shares in rival Hermès more than two years ago.

LVMH took a 17.1% stake in Hermès in October 2010, which has subsequently risen to 22.6%.

The judicial inquiry follows a preliminary investigation which began last October after Hermés filed a lawsuit against LMVH accusing it of manipulating share prices and of insider trading.

LVMH riposted by saying it had no choice but to file its own lawsuit against Hermès for "slander, blackmail and unfair competition."

However, it wasn't until earlier this week that the group took legal action over the allegations.

France's financial markets regulator, the Autorité des Marchés Financiers (AMF), is already investigating claims by Hermès against LVMH within the framework of its inquiry.

Last autumn its president, Gérard Rameix, said the AMF "had given notice of grievances and the case was scheduled to be examined by its sanctions commission, probably in the first months of next year."

However, the regulator has not commented on the case since then.