With a move that will enable greater access to luxury shoppers in the United States, LVMH has reached an arrangement to purchase Tiffany & Co. for $16.2 billion or $135 a share in cash. Shares of LVMH were trading 1.4 percent higher on Monday morning (Nov. 25) after the announcement, CNBC reported.
The boards of Tiffany and LVMH approved the deal, and the transaction is forecasted to close in the middle of next year, subject to regulatory approvals and approval from Tiffany’s shareholders.
Bernard Arnault, LVMH CEO, said the firm is looking “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.”
The fashion company noted in a statement, as reported by the outlet, that “the acquisition of Tiffany will strengthen LVMH’s position in jewelry and further increase its presence in the United States.” It also noted that it would “transform LVMH’s watches and jewelry division and complement LVMH’s 75 distinguished houses.”
LVMH has amassed a sizable luxury brand portfolio in various retail sectors, from perfume to fashion. Its famous brands include Dom Perignon, Moët & Chandon, Louis Vuitton and Givenchy.
In October, news surfaced that Tiffany & Co. had received an offer from LVMH Moët Hennessy Louis Vuitton, with jewelry among the fastest-growing businesses in the luxury sector. At the time, it was reported that the French firm sent the company’s officials a letter that outlined an all-cash, $120-per-share takeover bid that would value the firm at almost $14.5 billion.
Last year, the global jewelry market rose 7 percent and was worth roughly €18 billion. Tiffany is said to be one of the biggest jewelers in the world, alongside LVMH-owned Bulgari and Cartier.