LVMH makes $14.5bn bid to acquire Tiffany & Co; proposal being reviewed

By Andrew Pentol |

Tiffany-&-Co-Boutique

Tiffany has a strong presence in global travel retail and operates a number of boutiques in partnership with retailers such as Qatar Duty Free.

Tiffany & Co has today (28 October 2019) confirmed receipt of an ‘unsolicited non-binding’ proposal from LVMH Moët Hennessy Louis Vuitton’s to acquire Tiffany for $120 per share in cash (equivalent to a $14.5bn offer).

According to the US company, the two parties are not in discussions and Tiffany’s Board of Directors is carefully reviewing the proposal, with the assistance of independent financial advisors (Centerview Partners and Goldman Sachs) and legal advisors (Sullivan and Cromwell).

The aim of the review is to determine the course of actions it believes is in the best interests of the company and its shareholders.

Tiffany said: “Tiffany is successfully executing on its business plan and remains focused on achieving its goal of becoming The Next Generation Luxury Jeweller.”

NO AGREEMENT YET

An LVMH statement seen by TRBusiness read: “In light of recent market rumours, LVMH Group confirms it has held preliminary discussions regarding a possible transaction with Tiffany. There can be no assurance that these discussions will result in any agreement.”

As reported, total LVMH revenue (reported) increased +16% to €34bn ($37.7bn) in the first nine months of 2019 compared to €33.1bn in the first nine months of 2018. The Selective Retailing division, which includes travel retailer DFS Group, posted organic revenue growth of +6% during the same period.

GroupDFSAs far as Tiffany & Co is concerned, the company has developed strong partnerships with travel retailers worldwide including DFS Group for the launch of four Tiffany T pendants (pictured left) last year, which were available exclusively in DFS airport and T Galleria stores from 1 November 2018 until April 2019.

Tiffany & Co also operates a number of boutiques in airports worldwide, including Hamad International, where it opened a new boutique in partnership with Qatar Duty Free in September 2018.

On the fragrances front, Tiffany also partnered with Shilla Duty Free last year to pre-launch a special edition Tiffany & Co. scent in the retailer’s Beauty&You outlets at Hong Kong International Airport.

This is not to mention the agreement it established with Coty Inc back in 2016 for the development, production and distribution of a new line of Tiffany fragrances for men and women. This March, Coty launched Sheer, the third scent from its Tiffany & Co fragrance brand, following the original Eau de Parfum, and Eau de Parfum Intense. The scent is available in travel retail across the US, Asia Pacific and Europe.

The launch of Sheer was preceded by Coty’s global launch of Tiffany & Love for Him and Tiffany & Love for Her, from 1 October 2019.

 

 

 

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