Lvmh: Tiffany collapses on Wall Street, perhaps the 16 billion acquisition

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Rome. The Tiffany stock collapsed at the end of the session on Wall Street, losing more than 13% of its value. To cause the fall in prices, the indiscretions published by the specialized website Women’s Wewar daily (WWD), according to which the French fashion giant Lvmh could review its offer for the purchase for over 16 billion dollars of the luxury and jewelry brand American.An indiscretion reinforced by the fact that a board of directors was summoned by LVMH in Paris in the evening: according to agency sources, no decisions were made at the end of the meeting. But the authoritativeness of the source and the coincidence of the board, obviously alarmed the investors who were quick to lighten their positions on Tiffany, causing the collapse of the shares on the Dow Jones.
It is not difficult to imagine the reasons for the back of the French multinational led by Bernard Arnault, one of the richest men in the world. The main reason is the slowdown in consumption, also in the luxury sector, as a consequence of the global epidemic. Even if an important market for luxury like Asia has already partially started, all the big groups are making up their accounts and have to figure out where to concentrate resources. Lvmh, which is also the number one in the sector, does not escape from all this. It is not excluded, as some sources report, that the decision of the French company may also be dictated by the situation of social unrest that is inflaming the United States.Lvmh announced the acquisition of Tiffany at the end of November last year: a $ 16.2 billion offer equal to € 14.7 billion, based on a final offer of $ 135 per share, above 120 dollars offered at first. It was the largest operation – in financial terms – ever carried out by the group led by monsieur Arnault. In the intentions of the French company, Tiffany was part of the growth strategy in what, until last year, was considered one of the high growth sectors: with its 300 stores Tiffany is one of the largest jewelers in the world, together with Cartier and Bulgari, already purchased in the past years from Lvmh.



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https://www.repubblica.it/economia/2020/06/02/news/tiffany_crolla_a_wall_street_lvmh_potrebbe_ripensarci-258299446/

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