LVMH offers to acquire Tiffany
PARIS: The world’s biggest luxury group LVMH revealed on Monday that it had approached Tiffany & Co to takeover the US jewellery chain.
One source familiar with the mater said LVMH, which owns the Louis Vuiton and Bulgari brands among others, had proposed a bid valuing Tiffany at about $120 per share. That would be equivalent to a $14.5 billion acquisition offer, which would make it the acquisitive French group’s biggest purchase to date.
That would be a sharp premium to Tiffany’s current share price, which closed at $98.55 on Friday.
“In light of recent market rumours, LVMH Group confirms it has held preliminary discussions regarding a possible transaction with Tiffany,” the company said in a statement. “There can be no assurance that these discussions will result in any agreement.” Cash-richlvmhdidnotgiveanyfinancialdetails. Another source familiar with the situation, said the French group had submited a preliminary, non-binding offer to Tiffany earlier this month.
Shares in European watch and jewellery companies were among the top gainers in Europe in early deals ater news of LVMH’S interest in Tiffany.
Pandora was up 2.8%, while Salvatore Ferragamo was the biggest gainer on the Italian bourse, up 3.7% and Swatch and Richemont topped the Swiss market, up 1.6 and 1.9% respectively.
LVMH shares were up 1%, touching highs last seen in July.
“LVMH has ample financial capacity for a deal and we also expect many strategic and financial synergies,” analysts at Cowen said in a note.
Tiffany — which according to the sources has hired advisers to review LVMH’S offer but has yet to respond, and may not negotiate a deal - has been caught out by the Us-china trade war as Chinese tourists spend less in U.S. shopping hubs.