Tiffany and LVMH finally reach a deal

Tiffany Deal Is a Signature Move by the king of Luxury

Bernard Arnault, the chairman of LVMH Moët Hennessy Louis Vuitton and the richest man in Europe, is no stranger to public battles.

The soap opera also known as the largest deal in luxury, the LVMH Moët Hennessy Louis Vuitton-Tiffany acquisition, finally has a happy ending. The two companies originally announced their synergistic engagement last November only to engage in months of public mudslinging after the pandemic hit the luxury market and LVMH’s commitment turned wobbly. But on Thursday they said they had agreed to new terms.

LVMH will acquire Tiffany for $131.50 a share, $3.50 less than the original price but $1.50 more than Tiffany’s reported bottom line. That will save Bernard Arnault, the chairman of LVMH, and his shareholders the relatively low amount of $420 million off the original $16.2 billion price, and it will keep Tiffany from being left to fend for itself in an uncertain luxury environment.

It has been a drama-filled relationship, however, beginning in September when LVMH went public with the news that the French government — the government! — had asked it to wait on closing the deal.

Tiffany charged delaying tactics. LVMH accused Tiffany of being a “mismanaged business that over the first half of 2020 hemorrhaged cash.” Tiffany shot back that “LVMH’s specious arguments are yet another blatant attempt to evade its contractual obligation to pay the agreed-upon price for Tiffany.” Tiffany filed suit in a Delaware court for breach of obligations. LVMH countersued, saying the damage to Tiffany in 2020 meant it was no longer the same company it had agreed to acquire.