The American luxury jewelry retailer Tiffany & Co’s shareholders have approved the deal with French multinational corporation LVMH, marking an end to a year-long dispute between the two retailers.
At a virtual meeting of the Tiffany stockholders, over 99 percent of votes cast were in favor of the deal. As the deal has been approved, Tiffany will be dropped from the Standard & Poor’s 500 Index, S&P Dow Jones Indices stated.
The transaction valued at nearly $16 billion which is expected to close by early 2021 will give the billionaire Bernard Arnault, CEO of LVMH the long-sought pathway to expand his global footprint of luxury brands.
In late 2019, the parent company of Louis Vuitton made the first offer to buy the iconic jeweler, but when the luxury industry upended in the turmoil of the COVID-19 pandemic the company backed out from its promise to close the deal. This prompted a lawsuit by Tiffany and the companies eventually agreed to see the deal through at a slightly reduced price.
Initially, when the French company stepped out of the deal Tiffany had accused LVMH of having unclean hands. LVMH in turn blamed Tiffany for mismanagement of the business during the pandemic, while spending unwisely on dividends. Louis Vuitton also dragged French political intervention to delay completing the acquisition.
Tiffany had earlier stated that its sales were improving, citing demand recovery in the US and China, one of its biggest markets. LVMH then renegotiated the original deal price of $16bn and lowered it by $425 million.
In October, the two companies had reached an agreement, whereby LVMH would buy Tiffany for $131.50 a share, down from $135 originally promised. The two companies were set to face trial at the start of 2021 in the US.