LVMH and Tiffany, two major players in the luxury industry, have finally come to an agreement in their long-standing takeover battle. In order to move forward with the deal, both the French luxury conglomerate and the American jeweler have agreed to lower the price of the merger. Tiffany has accepted a reduced price from LVMH, a necessary step to prevent the collapse of the deal.

According to a statement from LVMH, the modified agreement states that the purchase price will now be $131.50 per share in cash, and there will be a reduction in closing conditionality. Despite the changes, the other key terms of the merger remain the same. The initial price of the deal was set at $135 per share. With the revised share price, the total value of the merger will amount to around $15.77 billion, representing a decline of approximately $425 million based on Tiffany’s share count in US securities documents.

LVMH, the parent company of renowned luxury brands like Louis Vuitton, Dior, and Moet & Chandon, first announced its plan to acquire Tiffany at the end of 2019. However, LVMH later decided to back out of the deal last month, citing various poor decisions made by Tiffany’s board since the deal was initially unveiled. Tiffany, on the other hand, argued that there was no valid reason to cancel the agreement and filed a complaint in a Delaware court, while LVMH responded with a counter-claim. The trial for the dispute has been scheduled for January 5, 2021, but the judge has urged both parties to engage in talks to avoid litigation.

The modified agreement with Tiffany’s board gives LVMH the confidence to proceed with the acquisition and resume discussions about integration details with Tiffany’s management, according to LVMH CEO Bernard Arnault. Arnault also expressed his belief in the tremendous potential of the Tiffany brand and stated that LVMH is the ideal home for Tiffany and its employees in this new chapter. Roger Farah, Chairman of Tiffany’s board, echoed this sentiment, stating that the agreement reached with LVMH is at an attractive price and will allow them to move forward with the merger. He further emphasized that the board concluded it was in the best interests of all stakeholders to ensure the deal reaches its finality. The merger is expected to be finalized in January.

This resolution brings an end to a tumultuous period for LVMH and Tiffany, paving the way for these two luxury giants to come together and embark on a new journey in the industry. The merger represents a significant milestone in the luxury market and will undoubtedly have a profound impact on both companies and their stakeholders. As the deal approaches its conclusion, the industry awaits eagerly for the strategic direction and synergies that will arise from this alliance.

For more information on Tiffany and LVMH’s merger agreement, visit:
1. Reuters
2. CNBC