LVMH is close to a deal to buy Tiffany & Co, the US jeweller, for more than $16 billion (Dh58.76bn) as it seeks to clinch what would be chairman Bernard Arnault's biggest takeover.
The French luxury conglomerate’s new proposal — at $135 a share — is 12.5 per cent above the initial $120-a-share bid. Both companies’ boards met on Sunday to approve the latest offer and an agreement could be announced as soon as Monday.
It’s not the first time that LVMH has raised its bid for Tiffany, a 182-year-old brand known for its robin’s egg blue boxes. Mr Arnault — Europe’s richest person — sought to woo Tiffany, which would expand LVMH’s access to US luxury shoppers, with an increased $130 bid just days ago. But some analysts had predicted the company could go for an even higher price, with targets of $140 at Credit Suisse and even $160 at Cowen.
Tiffany’s shares have traded steadily above the initial offer price since the talks were first reported in October, closing at $125.51 a share on November 22.
After a difficult period during which the US jeweller lost track of consumer trends, Tiffany is looking to bounce back by cutting its entry-priced gifting options and revamping its marketing for younger shoppers. For LVMH, the brand would help the Louis Vuitton owner challenge Cartier owner Richemont for dominance in the global jewellery business.
While LVMH — which oversees Christian Dior fashion, Bulgari jewellery and Dom Perignon Champagne — dwarfs Tiffany with sales of more than $50bn, the French giant is not as dominant in jewelry as it is in fashion or cosmetics.
Adding Tiffany would expand its selection of more accessible offerings, such as $165 heart-shaped earrings, as well as top-end options such as a $165,000 diamond chain.
