SourcingApr 18, 2024
Diamond Trade Remains Cautious Amid Economic UncertaintyDe Beers’ rough diamond sales were down 18 percent year-over-year in its latest round of sales.
MajorsSep 09, 2020
Tiffany Sues After LVMH Looks to Call Off Acquisition
The stage is set for a protracted legal battle as the $16 billion deal seems set to dissolve.
The redesigned Tiffany & Co. flagship store at Shanghai Hong Kong Plaza. Tiffany is taking LVMH to court in the United States in an effort to force it to move forward with its acquisition of the specialty jeweler. (Photo courtesy of Tiffany & Co.)
New York—LVMH announced that it is backing out of its agreement to buy Tiffany & Co., and the retailer is not happy about it.
In a statement issued Wednesday morning, LVMH cited closing date issues—Tiffany reportedly asking for a second extension to Dec. 31, 2020 and the French government requesting LVMH wait until January 2021 because of proposed U.S. tariffs on French luxury goods—as the reason for its decision to call off the deal.
LVMH said: “As a result 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 Nov. 24, 2020 and officially records that, as it stands, LVMH will therefore not be able to complete the acquisition of Tiffany & Co.”
Tiffany responded with its own statement Wednesday morning, announcing it was suing LVMH in an attempt to force it move forward with the $16.2 billion deal.
It claims LVMH has breached the merger agreement, dragging its feet on its obligations and searching for loopholes to get out of the acquisition as outlined.
LVMH, the retailer claims, did not uphold its obligation to “do everything necessary” to secure all required regulatory clearances as promptly as possible.
The merger agreement originally set the deal’s closing date for Aug. 24 but Tiffany asked to extend to Nov. 24—an extension allowed under the agreement—because they still needed a number of antitrust clearances, which Tiffany says LVMH has not been proactive in getting.
As of Aug. 24, with only three months to go until the Nov. 24 closing date, Tiffany noted that, “LVMH had not even filed for antitrust approval … in the European Union or Taiwan, and applications are still outstanding in Japan and Mexico, all due to LVMH’s concerted efforts to delay or avoid receipt of regulatory approvals in those jurisdictions in breach of the merger agreement.”
The specialty jeweler also claimed LVMH was using the purported tariffs as an excuse to back out of the deal.
LVMH said it received a letter dated Aug. 31 from France’s Ministry of Europe and Foreign Affairs informing it of a U.S. government threat to put additional taxes on French products, particularly luxury goods.
The ministry asked the Paris-based luxury conglomerate to show support for France’s efforts to
dissuade the U.S. government from imposing additional tariffs by putting off its acquisition of Tiffany, an American company.
But Tiffany said there is no basis in French law for the Foreign Affairs Minister to order a company to breach a valid and binding agreement, and it accused LMVH of using “any available means in an attempt to avoid closing the transaction on the agreed terms.”
LVMH Moët Hennessy Louis Vuitton announced its intention to acquire Tiffany in November 2019, with the deal originally set to close in mid-2020.
Then COVID-19 hit, taking a toll on luxury retail worldwide.
By June, rumors began to circulate that the deal was on shaky ground, with LVMH Chairman and Chief Executive Bernard Arnault reportedly seeking to pay a lower price for the storied retailer.
Tiffany filed its lawsuit in the Court of Chancery in Delaware, where it is incorporated.
But Tiffany said there is no basis in French law for the Foreign Affairs Minister to order a company to breach a valid and binding agreement, and it accused LMVH of using “any available means in an attempt to avoid closing the transaction on the agreed terms.”
LVMH Moët Hennessy Louis Vuitton announced its intention to acquire Tiffany in November 2019, with the deal originally set to close in mid-2020.
Then COVID-19 hit, taking a toll on luxury retail worldwide.
By June, rumors began to circulate that the deal was on shaky ground, with LVMH Chairman and Chief Executive Bernard Arnault reportedly seeking to pay a lower price for the storied retailer.
Tiffany filed its lawsuit in the Court of Chancery in Delaware, where it is incorporated.
More on Majors
The Latest
Supplier BulletinApr 18, 2024
Discover History’s Hidden Gems at the Las Vegas Antique Jewelry & Watch ShowSponsored by the Las Vegas Antique Jewelry & Watch Show
WatchesApr 18, 2024
Watch E-tailer Collectability Hires Kelly YochThe Patek Philippe expert will serve as personal curator for the brand-focused company.
Brought to you by
The Blueprint for Success in Scalable, Personalized Jewelry RetailWith Ho Brothers, you can unlock your brand's true potential and offer customers the personalized jewelry experiences they desire.
WatchesApr 18, 2024
TAG Heuer Opens Its Largest Standalone Boutique at SeaThe 553-square-foot shop is aboard the Carnival Jubilee cruise ship.
Weekly QuizApr 11, 2024
This Week’s QuizTest your jewelry news knowledge with this seven-question quiz.
Policies & IssuesApr 17, 2024
NDC Prevails in U.K. Case Over Lab-Grown Diamond AdvertisingNDC filed a complaint against Skydiamond for use of phrases like “diamonds made entirely from the sky.”
Events & AwardsApr 17, 2024
And the 2024 Winner of the Shipley Award Is … John Carter received the AGS’s highest honor Tuesday afternoon at Conclave in Austin, Texas.
Brought to you by
How Jewelers of America Represents Your BusinessFor over 30 years, JA has advocated for the industry, fought against harmful legislation and backed measures that help jewelry businesses.
FinancialsApr 17, 2024
LVMH’s Q1 Jewelry Sales Fall 5%LVMH said the company performed well despite an uncertain geopolitical and economic environment.
CollectionsApr 16, 2024
Akaila Reid Launches ‘Eat Cake’ CollectionIt’s ultra-feminine and filled with gold, pearls, and soft pastels.
MajorsApr 16, 2024
Stuller Releases First Lab-Grown Diamond Jewelry CatalogIts updated book for mountings is also now available.
SourcingApr 16, 2024
Karen Rentmeesters Takes Over as Interim CEO of AWDCShe has been with the organization since 2010, most recently serving as its chief officer of PR and industry relations.
TechnologyApr 15, 2024
Judge Rules Jeweler’s Lawsuit Against PNC Bank Can Move ForwardJoyce’s Jewelry sued the bank after cybercriminals drained its accounts of nearly $1.6 million through a series of wire transfers.
IndependentsApr 15, 2024
Alfred W. DeScenza of DeScenza Diamonds Dies at 95He is remembered by loved ones for his loyalty, integrity, and kindness.
AuctionsApr 15, 2024
Madeleine K. Albright Jewelry, Pins Coming to AuctionHosted by Freeman’s | Hindman, the sale will take place May 7-8.
AuctionsApr 15, 2024
All of Sotheby’s ‘Rough Diamonds’ Sold in Less Than an HourThe auction house said all 24 timepieces offered in its underground sale of rare and avant-garde watches quickly found buyers.
Events & AwardsApr 15, 2024
10 Can’t-Miss Sessions at AGS Conclave 2024From lab-grown diamonds and AI to the inevitable Taylor Swift mention, here are some of Conclave’s most intriguing educational offerings.
Recorded WebinarsApr 12, 2024
Watch: What Jewelers Need to Know About InsuranceFrom cybersecurity liability to trade show coverage, insurance experts share tips on how to build the right policy.
CollectionsApr 12, 2024
Piece of the Week: Lionheart’s Evil Eye Gemstone CharmThe charm is a modern rendition of the evil eye amulet that has been worn for thousands of years.
Events & AwardsApr 12, 2024
The Jewelry Symposium Announces 4 Scholarship WinnersAhead of its trade show next month, TJS awarded free registration and accommodations to one jewelry professional and three students.
Policies & IssuesApr 11, 2024
SRK Exports’ Journey Toward Net Zero Impact By the end of this year, SRK’s diamond manufacturing complexes will achieve net zero emissions, one of an impressive array of achievements.
Lab-GrownApr 11, 2024
AGTA Bans Lab-Grown Diamonds, Gemstones at GemFairMembers can still sell lab-grown stones, it said, but only natural gems are allowed on the show floor.
IndependentsApr 11, 2024
Steven Rosdal, Co-Founder of Hyde Park Jewelers, Dies at 77He is remembered for his charisma, passion, integrity, kindness, and wit.
MajorsApr 11, 2024
Macy’s Opens Books for Possible BuyoutThe retailer also appointed two new board members, avoiding a proxy fight from a potential buyer.
CollectionsApr 10, 2024
Sylvie Launches New Nature-Inspired Collection, ‘Tulira’The bridal collection consists of 35 engagement rings and seven wedding bands.
WatchesApr 10, 2024
These Are Rolex’s New Watches for 2024 The crown introduced a dozen timepieces in Geneva, including a heavy metal version of its deep-sea divers’ watch.
IndependentsApr 10, 2024
Levy's Fine Jewelry Explores Diamond History The family-owned jeweler has a new education section on its website dedicated to the history of diamond cutting.
