LVMH, the French luxury conglomerate that owns Bulgari, Christian Dior and Louis Vuitton, proposed the all-cash deal in early October, valuing Tiffany & Co. at $US120 per share.
At the time, industry commentators predicted the proposal was likely to be rejected by the Tiffany board and that a valuation of $US140 per share would be the minimum acceptable offer.
When the news became public, the Tiffany & Co. share price jumped 32 per cent, from $US98.55 to $US129.72 – close to its five-year high of $US136.27.
At the time of publication, it was trading at $US125.67.
Reuters, quoting sources ‘close to the negotiation’, reports that Tiffany & Co. remains open to the LVMH takeover if a higher offer is made. LVMH management is reportedly considering making a second bid.
Tiffany & Co. currently operates more than 320 stores worldwide. Its annual sales were $US4.4 billion ($AU6.4 billion) in 2018, with 92 per cent coming from the sale of jewellery.
Meanwhile, LVMH’s annual revenue for 2018 was €46.8 billion ($AU75.3 billion), with the majority – 67.5 per cent – coming from the fashion and leather goods and specialty retailer sectors. Watches and jewellery accounted for just 9 per cent of total revenue.
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