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LVMH cannot complete acquisition of Tiffany & Co
10 Sep '20
2 min read
Pic: Shutterstock
French luxury group LVMH recently called off its acquisition of US jewellery giant Tiffany & Co, citing delay in the closing date. The company had received a letter from the French government, directing it to defer the acquisition of Tiffany until after January 6, 2021, it said in a statement. This comes amid a recent threat to impose taxes on French products by the United States.
"The board learned of a letter from the French European and Foreign Affairs Minister, which, in reaction to the threat of taxes on French products by the US, directed the group to defer the acquisition of Tiffany until after January 6, 2021," the Louis Vuitton parent said.
LVMH's board also took note of Tiffany's request to extend the "Outside Date" in the merger agreement from November 24 to December 3, 2020.
"As a results of these elements, and knowledge of the first legal analysis led by the advisors and the LVMH teams, the board decided to comply with the merger agreement signed in November 2019 which provides, in any event for a closing deadline no later than November 24, 2020, and officially records that, as it stands, the Group LVMH will therefore not be able to complete the acquisition of Tiffany & Co.," it said.
LVMH had in November last year agreed to a $16.2 billion acquisition of Tiffany, whose shareholders gave the green light to the deal in February this year.
Tiffany's has now reportedly decided to sue the French luxury group for resorting to delaying tactics to force a renegotiation of the deal.
"The board learned of a letter from the French European and Foreign Affairs Minister, which, in reaction to the threat of taxes on French products by the US, directed the group to defer the acquisition of Tiffany until after January 6, 2021," the Louis Vuitton parent said.
LVMH's board also took note of Tiffany's request to extend the "Outside Date" in the merger agreement from November 24 to December 3, 2020.
"As a results of these elements, and knowledge of the first legal analysis led by the advisors and the LVMH teams, the board decided to comply with the merger agreement signed in November 2019 which provides, in any event for a closing deadline no later than November 24, 2020, and officially records that, as it stands, the Group LVMH will therefore not be able to complete the acquisition of Tiffany & Co.," it said.
LVMH had in November last year agreed to a $16.2 billion acquisition of Tiffany, whose shareholders gave the green light to the deal in February this year.
Tiffany's has now reportedly decided to sue the French luxury group for resorting to delaying tactics to force a renegotiation of the deal.
Fibre2Fashion News Desk (DS)
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