Yahoo Finance Tiffany and LVMH try to kiss and make up
LVMH could strike a cut-price deal to buy US jeweller Tiffany as it emerged the pair are in talks to renegotiate the planned $16bn (£12bn) takeover.
The French luxury goods group agreed to pay $135 a share for Tiffany in November last year, but the deal ran into trouble last month when LVMH said it was abandoning the purchase, sparking an acrimonious legal battle.
LVMH, which is run by Europe's richest man Bernard Arnault, blamed French political intervention and Tiffany's "dismal" performance during the coronavirus crisis for its withdrawal.
The two companies are facing off in a Delaware court, with Tiffany seeking to force LVMH to honour the deal. The case is due to be heard in early January.
However, Tiffany has since signalled that it is willing to consider a lower price from LVMH as long as it was above $130 a share, the Financial Times reported. Tiffany and LVMH are now said to be in discussions regarding a revised deal.
Tiffany shares rose 5pc to $129.08 following the reports.
A takeover of Tiffany would mark the biggest deal in LVMH's history and gain the Louis Vuitton owner a larger presence in the US market and jewellery and watch division, its smallest business.
Analysts have estimated that a merger of the two firms could double the size of LVMH's jewellery and watches division, giving the group an additional €5bn of annual sales.
LVMH is the world's biggest luxury conglomerate and houses brands including Christian Dior, Bulgari jewellery and Moët & Chandon champagne.
Famed for its diamond engagement rings and distinctive blue gift boxes, Tiffany was founded in 1837 and featured in the 1961 movie Breakfast at Tiffany’s starring Audrey Hepburn. It is one of the world's largest jewellers but has struggled with lacklustre annual sales and profit for years.
Tiffany said on Monday it had received approval from the European Commission for the deal, clearing all regulatory hurdles.
LVMH declined to comment. Tiffany has been contacted for comment.
