LVMH-Tiffany Acquisition Considered a Mega Deal in the Luxury Industry
Acquisition Process Completed on the 7th (Local Time)
[Asia Economy Reporter Kwon Jae-hee] The acquisition negotiations between Louis Vuitton Mo?t Hennessy (LVMH) and the American jewelry company Tiffany & Company (Tiffany), considered a mega deal in the luxury industry, have finally come to an end. The negotiations between the two companies, which were full of ups and downs from the announcement of the acquisition to the cancellation and lawsuits, have finally been concluded.
According to the Wall Street Journal (WSJ) on the 7th (local time), LVMH announced in an official statement that it has completed the acquisition of Tiffany for $15.8 billion (approximately 17 trillion KRW). Although this is lower than the original acquisition price of $16.6 billion, it is considered the largest deal in the history of the luxury industry.
Bernard Arnault, Chairman of LVMH, stated in the announcement, "Tiffany is an iconic brand in the global jewelry industry and synonymous with love," and "We welcome Tiffany's joining."
Accordingly, Tiffany will be added to LVMH's list of subsidiaries, including Louis Vuitton, Christian Dior, Fendi, and Givenchy.
With the completion of LVMH's acquisition of Tiffany, the team to operate Tiffany has also been outlined.
Antoine Arnault, LVMH's Executive Vice President, will become Tiffany's Chief Executive Officer (CEO). Having previously worked at Tiffany, he is considered a suitable figure to smoothly integrate Tiffany into the LVMH group.
Additionally, Alexandre Arnault (28), son of Chairman Arnault, will join the Tiffany team. He will lead the team as Vice President in charge of product and communications. Alexandre has managed Rimowa, a travel luggage brand and one of LVMH's subsidiaries, for the past four years. Michael Burke, Chairman and CEO of LVMH, has been appointed as Chairman of Tiffany's board.
Meanwhile, LVMH had been pursuing the acquisition of Tiffany since 2019 but abruptly expressed its intention to abandon the acquisition last September, citing trade disputes between the United States and France. Although the surface reason was the trade dispute, suspicions arose that the real intention was to lower the acquisition price as Tiffany was severely impacted by the COVID-19 pandemic, leading to legal battles between the two companies.
In fact, LVMH initially agreed to acquire at $135 per share but finally settled at $131 per share.
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