The all-cash deal is expected to close in the middle of 2020
Picture: AFP/STEPHANE DE SAKUTIN
The owner of the Louis Vuitton brand agreed to pay $135 a share for the US jeweller, according to a statement Monday. That values Tiffany 37% above the closing price before Bloomberg reported an initial $120-a-share approach on October 26. Boards of both companies approved the proposal on Sunday. “It will become the luxury jewellery global-market leader,” Bloomberg Intelligence analyst Deborah Aitken wrote in a recent report. The acquisition is set to more than double LVMH’s jewellery scale and boost its market share to more than 18%, she said.The deal cements a successful streak for Arnault’s firm, with LVMH’s stock price quadrupling during the past eight years.
Tiffany’s shares have traded steadily above the initial offer price since Bloomberg News first reported the talks late in October.LVMH raised its bid for Tiffany at least twice before coming to an accord, bolstering its offer to $130 just days ago, according to people with knowledge of the situation. While the company dwarfs Tiffany, with sales of about $50bn, some analysts had predicted LVMH might need to pay even more, with price targets of $140 at Credit Suisse and $160 at Cowen.
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