Henri Pinault's decision to hire Renault boss Luca de Meo is an audacious but necessary move to address the twin challenge of sagging sales and mounting debt at luxury group Kering, investors and industry players say.

The luxury group confirmed speculations reported by a number of media outlets this weekend. Pinault will retain his role as Kering chair.

De Meo plans to pursue new challenges outside the automotive industry after having led the carmaker for five years.