December 08, 2019

French Luxury Group LVMH Acquires Tiffany & Co. for $16.2 Billion

Millennial Capital, the specialist consumer focused venture creation and management firm based in Dubai, comments on the landmark deal

Dubai (December 2019): Millennial Capital, the specialist consumer focused venture creation and management firm based in Dubai has recently identified personal accessories, specifically jewellery, as one of its key sectors of investment interest, and comments on Louis Vuitton Moet Hennessy’s (LVMH) ground-breaking purchase of Tiffany & Co. for about $16.2 billion.

Following months of extensive negotiation and weeks of speculation, LVMH has confirmed the landmark deal, the largest acquisition in the luxury group’s history and one of the biggest pieces of business the luxury retail industry. LVMH purchased Tiffany & Co. for approximately $135 per share after initially offering $120 per share.

“The acquisition of Tiffany by LVMH highlights the objectives of the French conglomerate to retain a global market leadership position in the personal accessories sector, specifically the jewellery category, estimated globally at $357 bn. Tiffany & Co. being one of the most desirable international jewellery brands, retaining 1% of the global jewellery category, will provide LVMH with an excellent market entry to deploy its luxury brand building knowledge and curated expertise, but also gain access into China and the USA, which are globally the two most attractive jewellery markets. Following the acquisition of Dior in June 2017 and Tiffany & Co. in 2019, we can further expect LVMH to continue its M&A strategy to further strengthen its portfolio of prestige brands in the near future," says Andreea Danila, Founder of Millennial Capital. 

Millennial Capital’s recent personal accessories report reveals that among the key categories that contribute a majority of the personal accessories market size are jewellery (USD 357bn), bags & luggage (USD 150 bn), watches (USD 68 bn) and writing instruments (USD 21 bn). Globally, the jewellery category dominates two thirds of the market and with fine jewellery retaining c. 3.1% of total jewellery category. The estimated growth of the jewellery category is limited as the sector is facing disruption from key trends such as democratization of luxury, digitization and personalization driven by the millennials who represent c. 32% of total addressable consumers but also products of ethical living.

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