Tiffany Shareholders Okay LVMH Offer

Tiffany & Co. and LVMH Moët Hennessy Louis Vuitton have made their new deal official. 

Tiffany shareholders approved the updated agreement for LVMH to acquire the iconic American jeweler, which was announced in October, at this morning’s special shareholder meeting with nearly 99 percent voting in favor of the deal, or more than 88 million votes for the merger and only about 107,000 against it. 

The new deal replaces the original November 2019 agreement with a $131.50 in cash per share purchase price, compared with the original offer of $135 a share. That equals about $420 million in savings for LVMH. The two parties also agreed to settle pending litigation in the Delaware Chancery Court. The final purchase price is $15.8 billion.

After the deal is complete, Tiffany will no longer be a public company, but an indirect wholly-owned subsidiary of parent company LVMH.   

LVMH first agreed to buy Tiffany for $16.2 billion late last year in what is the largest acquisition in the luxury space. But that was pre-pandemic. 

After the coronavirus began making its way around the globe, causing mass shutdowns, LVMH seemed to get cold feet. LVMH said it was walking away from the deal in September, pointing at first to an unusual request from the French government (which is in the midst of a trade spat with Washington) and then mismanagement, poor performance and clauses in the contract. 

Shares of Tiffany & Co. were roughly flat at the start of Wednesday’s trading session, after the news was announced.

The next question is where LVMH takes Tiffany from here. Speculation has been rife over the future of Tiffany chief executive officer Alessandro Bogliolo as well as the company’s chief artistic officer Reed Krakoff. Sources have said that Anthony Ledru, LVMH’s executive vice president of global commercial activities based in Paris, is a frontrunner to move into the top job at Tiffany – where he previously worked as vice president of North America. Meanwhile, LVMH chief Bernard Arnault’s son Alexandre is also seen as taking on a role at his father’s newest bauble. Alexandre Arnault, currently ceo of Rimowa, accompanied his father when the luxury titan toured Tiffany for the first time last December, as did his brother Frederic, who in June was named ceo of Tag Heuer.

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