French luxury brand LVMH offers to buy Tiffany for $14.5 billion
29 October 2019
French luxury goods major LVMH has made an unsolicited offer to buy US-based Tiffany and Co, known for its engagement rings and ties to Hollywood glamour, in a deal worth $14.5 billion.
Confirming the move, Tiffany said the offer was worth $120 per share, which would value Tiffany at nearly $14.5 billion and represents a 22 per cent premium over the stock’s closing price on Friday.
LVM, the owner of Louis Vuitton and Bulgari, hopes the acquisition of Tiffany would help expand in jewellery, one of the fastest-growing sections of the luxury goods market.
LVMH on Monday said it had approached Tiffany about an unsolicited non-binding offer, but did not give further details.
US-based Tiffany said it is "reviewing" a takeover offer worth about $14.5bn (£11.3bn) from the world's biggest luxury goods company, LVMH.
The companies confirmed the offer in separate statements on Monday, with the 182-year-old Tiffany saying there are currently no talks.
LVMH, owned by France's richest man, Bernard Arnault, has brands, including Christian Dior, Givenchy, and Bulgari.
In a two-sentence statement early on Monday, LVMH said it "confirms that it has held preliminary discussions regarding a possible transaction with Tiffany," adding that there is no certainty of a deal.
Tiffany, listed on the New York Stock Exchange, also said it "has received an unsolicited, non-binding proposal from LMVH" of $120 per share in cash.
LVMH said there was no guarantee that preliminary discussions would result in an agreement.
Tiffany, founded in New York in 1837 and made famous by the 1961 movie “Breakfast at Tiffany’s” starring Audrey Hepburn, said it was still reviewing the proposal and is “not in discussions”.
The potential deal comes as some of LVMH’s watch labels like Tag Heuer have struggled, in part as they try to adapt to the rise of smartwatches, while this sector has also been hit hard by turmoil in Hong Kong, a major market for high-end timepieces.
If the deal goes ahead, it would be the biggest acquisition to date by LVMH, owned by France’s richest man Bernard Arnault, and comes after it bought Bulgari in 2011.