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LVMH Acquires Tiffany for USD 16.2 Billion

French luxury goods empire LVMH Monet Hennessy-Louis Vuitton (OTC: LVMUY) will add Tiffany & Co. (NYSE: TIF) to its portfolio of high-end brands, the company confirmed on Monday

LVMH, parent of Louis Vuitton and Christian Dior, will buy the Manhattan jeweler for USD 135 per share, valuing Tiffany at about USD 16.2 Billion. The transaction is expected to close in the middle of 2020.

“We are delighted to have the opportunity to welcome Tiffany, a company with an unparalleled heritage and unique position in the global jewelry world, to the LVMH family,” said Bernard Arnault, Chairman and Chief Executive Officer of LVMH.

The takeover will largely expand LVMH’s presence in the U.S. and enhance its collection of top jewelry brands. Its Watch and Jewelry sector, made up of six brands including Tag Heuer and Bulgari, generated sales of nearly USD 4.6 Billion in 2018

“As part of the LVMH group, Tiffany will reach new heights, capitalizing on its remarkable internal expertise, unparalleled craftsmanship and strong cultural values,” said Alessandro Bogliolo, Chief Executive Officer of Tiffany.

With more than 300 stores worldwide, Tiffany is one of the world’s largest jewelers, along with Cartier and LVMH-owned Bulgari.  The company has about USD 4 Billion in annual revenue, but has struggled with lackluster sales growth for years due to a decline in tourist spending. 

To combat its struggling sales growth, Tiffany has begun targeting new millennial consumers, especially in China, lowering the cost of jewellery and launching new items more frequently.