Tiffany shares fall with LVMH deal in doubt
Shares of luxury retailer Tiffany are under pressure for a second straight session Wednesday on concern French luxury goods maker LVMH wants to walk away from their more than $16 billion takeover.
The deal is said to be on shaky ground as Tiffany grapples with the twin fallout from a sharp downturn in sales, according to fashion publication WWD, which also reported the board of LVMH met on Tuesday evening in Paris to discuss the matter.
Tiffany’s doors were closed for nearly three months due to stay-at-home orders, and now protests in the U.S. threaten reopening plans. LVMH - The company behind the iconic Louis Vuitton brand - worried that a drop in Tiffany's sales will makes it hard for Tiffany to cover all the costs of closing the deal, which was expected to happen mid-year, according to the report.
Tiffany did not respond to a Reuters request for comment.
The luxury retailer was already in a turnaround plan when it was approached by LVMH and the two agreed to a deal back in November.
The marriage was supposed to combine Tiffany's long-established premium standing in the U.S. retail world with one of the most recognizable global high-end brands.
Tiffany has struggled to take part in the seismic shift in consumer spending to online from brick-and-mortar, as well as attract younger buyers, and was facing the additional challenge of a drop in international tourism to its flagship New York City store, particularly from China.
