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LVMH-Tiffany deal sealed, but long wait until settlement

Subject to regulatory approvals, the LVMH-Tiffany deal is sealed: the French luxury fashion powerhouse will take over the iconic New York City-headquartered jeweller.

But it may be mid next year before the transaction is completed after shareholder and regulatory processes are complete.

LVMH will pay US$135 per share in cash for Tiffany, giving the jeweller an equity value of €14.7 billion or $16.2 billion.

The LVMH-Tiffany deal provides “an exciting path forward,” said Tiffany chairman Roger N Farah, describing LVMH as “a group that appreciates and will invest in Tiffany’s unique assets and strong human capital, while delivering a compelling price with value certainty to our shareholders”. 

Bernard Arnault, chairman and CEO of LVMH and now within striking distance of becoming the world’s richest man when this deal is settled, described Tiffany as “a company with an unparalleled heritage and unique position in the global jewellery world”. 

“We have an immense respect and admiration for Tiffany and intend to develop this jewel with the same dedication and commitment that we have applied to each and every one of our maisons. We will be proud to have Tiffany sit alongside our iconic brands and look forward to ensuring that Tiffany continues to thrive for centuries to come.”

It was a quick deal, coming little more than one month after the rumours of negotiations broke and will mark the beginning of a new chapter in the 180 year old company’s history.  But the two spokesmen said completing regulatory filings and the formalities of shareholder approval might take until “mid 2020”. 

With more than 300 stores worldwide, Tiffany will give LVMH a strong position in the jewellery sector in which it is underrepresented compared to luxury-goods rival Richemont. The French company says the LVMH-Tiffany deal will strengthen its watches and jewellery division and complement its huge portfolio of 75 brands. Most significantly, it gives the luxury retail group a strong presence in the key US market. 

Farah said Tiffany undertook “a thoughtful internal process” and sought expert external advice before agreeing to terms with LVMH. 

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