LVMH may acquire Tiffany & Co, says the European competition watchdog. Remarkably the green light is not welcome at all this time, as the Vuitton mother looks for a way out of the deal.
Against the wishes of LVMH
According to the European competition authorities, LVMH may acquire US jewellery chain Tiffany & Co. There is no danger of monopolisation or restriction of consumer choice, the competition watchdog judges, so the 16.2 billion dollar deal gets the green light from Europe. This removes a major obstacle to the acquisition.
Remarkably, however, this is not the desired result, at least not for LVMH. It must be one of the first times in history that an acquirer is dissatisfied with the approval of the competition authority, as LVMH is feverishly looking for a way out of the takeover deal.
Since the corona crisis, the luxury sector has been in a historic dip and Tiffany's sales plummeted. The future does not look rosy either: analysts expect 35% less sales for the year as a whole and as long as the virus causes the Chinese to travel less to the West, recovery will also be delayed.
Tiffany & Co, on the other hand, wants the acquisition to go ahead. The jewellery chain proudly announces that Europe gives its blessing. Both companies are now engaged in a legal battle, with the all-important trial starting on 5 January.