March 23, 2020 / 10:00 AM / 6 days ago

LVMH says will not buy Tiffany shares on open market

FILE PHOTO: A Tiffany & Co. logo is seen outside a store in Paris, France, November 22, 2019. REUTERS/Gonzalo Fuentes/File Photo

PARIS (Reuters) - Louis Vuitton owner LVMH (LVMH.PA) said on Monday it would not buy Tiffany shares (TIF.N) on the open market, a move that would have potentially enabled it to pursue its agreement to buy the U.S. jeweler at a lower price than the one agreed last year.

Bloomberg reported last week that the French luxury goods group was now considering buying shares in Tiffany on the market, following its deal last November to buy the company for $16.2 billion, or $135 a share.

Stock markets have tumbled worldwide as the coronavirus pandemic pushes several governments in Europe and elsewhere to order unprecedented shutdowns to try and contain its spread.

“Rumors circulated recently indicating that LVMH would consider buying Tiffany shares on the open market,” the company said in a statement. “These rumors lead LVMH to recall that, in accordance with the agreement concluded with Tiffany in November 2019, LVMH is currently committed not to buy Tiffany shares.”

Such a move would have been highly unusual, though potentially feasible with Tiffany’s blessing.

The jeweler last week forecast a significant hit to its results this year, as it temporarily closes several outlets, including its iconic flagship Fifth Avenue store in New York.

Tiffany shares closed at $125 each on Friday.

Reporting by Sarah White; Editing by Simon Cameron-Moore

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