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28 October 2019

Louis Vuitton’s owner plans to acquire Tiffany for $14.5 billion

The luxury group approached New York-based Tiffany with a takeover proposal earlier in October 2019 and the all-cash bid values the jeweller at about $120 a share.


LVMH’s $14.5 billion bid for US jeweller Tiffany & Co. is more than Europe’s richest man trying to pick up some stateside trinkets, reported Bloomberg.

Bernard Arnault’s luxury-goods house, the French purveyor of Louis Vuitton bags and Givenchy haute couture, is making its biggest bet ever with Tiffany. The success of LVMH will give the company access to more US consumers who have the resources to reach for beautiful things—if not quite yet the portfolio’s EUR 2 million ($2.2 million) Bulgari wristwatches.

Additionally, Tiffany’s name resonates internationally, expanding LVMH’s global footprint in fast-growing branded jewellery.

An acquisition would give LVMH an iconic 182-year-old US brand known for its robin’s egg blue boxes and its role as a favourite haunt of Holly Golightly in Truman Capote’s ‘Breakfast at Tiffany’s.’ The French company also owns Sephora cosmetics stores, Hublot watches and Dom Perignon Champagne.

Additionally, a takeover of Tiffany would be bigger than the $7 billion LVMH paid for the rest of Christian Dior in 2017. For 70-year-old Arnault, the French company’s Founder, Chairman and Chief Executive Officer, it would be his first major transaction since the purchase of luxury hotel chain Belmond in 2018 and potentially among the largest deals by a European company in 2019.

A purchase would further diversify the conglomerate, which has been riding a wave of luxury demand in China but faces risks including that country’s trade war with the US and the months-long anti-Beijing protests in Hong Kong.

After a difficult period when it lost track of consumer trends and suffered from a slump in US tourism, Tiffany has been bouncing back under Chief Executive Officer Alessandro Bogliolo, revamping its New York flagship store with major investments targeting younger shoppers.

Bogliolo, a former executive of Bulgari and jeans label Diesel who was hired by the US jeweller two years ago after hedge fund Jana Partners pushed for changes, has refreshed Tiffany’s marketing. The CEO said last month that he plans to open more stores in mainland China as a weak yuan deters the country’s consumers from spending overseas.

LVMH is looking to sharpen its focus on the US, the company’s second-largest region by revenue behind Asia. Earlier this month, it opened a new Louis Vuitton factory in Texas in a ceremony that included President Donald Trump and his daughter Ivanka.

In jewellery, the company isn’t as dominant as in fashion, however, adding Tiffany would expand the French giant’s potential market with somewhat more accessible offerings. Unlike Bulgari’s more-rareified offerings, Tiffany is better known for engagement rings that might cost a couple months’ pay.






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