French luxury goods conglomerate LVMH has its eyes on expanding its foothold in the jewellery market with a USD14.9 billion offer for the iconic American jeweller Tiffany & Co.
According to reports from Bloomberg News, the owner of luxury brands like Louis Vuitton and Givenchy gave the all-cash bid that values Tiffany at USD120 per share, a 22% premium over its stock price of USD98.55 as of 25 Oct 2019. That has since pushed the share price of Tiffany up by 30% to USD127.99 when trading resumed on 28 Oct 2019.
Despite this exceptional valuation, analysts expect Tiffany to reject the unsolicited bid and seek for a higher valuation, as much USD140 -USD160 per share.
Should the bid go through this would represent the largest deal by LVMH Chairman and Chief Executive Officer Bernard Arnault. A successful LVMH bid for Tiffany would also help the luxury conglomerate establish a greater presence in the United States and in the jewellery market.
UPDATE: On 24 November, Louis Vuitton completed its purchase of Tiffany & Co. for USD16 billion.
