Luxury Giant LVMH Proposes $14.5 Billion Takeover of Tiffany & Co.

28/10/2019 15:27

Tiffany & Co. has received a takeover approach from LVMH Moët Hennessy Louis Vuitton, which is seeking to add the iconic U.S. jeweler to its portfolio of upscale brands. The French company sent Tiffany officials a letter in the past couple of weeks outlining an all-cash takeover bid of about $120 a share, according to people familiar with the matter. That would value Tiffany at close to $14.5 billion, and represents a 22% premium over the stock’s closing price on Friday, according to the Financial Times.

Tiffany issued a brief statement saying it is "carefully reviewing" the proposal takeover offer from the world's biggest luxury goods company, adding that they are they are "not in discussions." LVMH also confirmed the offer in a statement on Monday. LVMH, owned by France's richest man, Bernard Arnault, has brands including Christian Dior, Givenchy, Louis Vuitton and Bulgari, and are seeking to expand in jewelry, one of the fastest-growing parts of the luxury goods market, but currently one of LVMH's smallest and newest business divisions. LVMH said there was "no assurance that these discussions will result in any agreement," but if the deal goes ahead, it would be the biggest acquisition to date by LVMH.

Reuters reported that several analysts said Tiffany might reject the offer to seek a higher price tag, potentially kicking off a battle for control of the company, while analysts said Tiffany could be worth as much as $140-$160 per share. The stock trades at a big discount to its U.S and European sector.