Tiffany Files Lawsuit Against LVMH

In November 2019, luxury giant LVMH Moët Hennessy Louis Vuitton SE confirmed that it has reached a $16.2 billion deal to buy American jeweller Tiffany & Co. For the previous post, click here please.

Yesterday, after months of speculation, LVMH has called off its planned mega-merger with the American jeweler. The result? Tiffany sinks 11% and is now suing the French luxury conglomerate to keep the acquisition on track. The jewelry giant alleged LVMH sought to leverage US social justice protests and the coronavirus pandemic to «avoid paying the agreed price for Tiffany shares.»

LVMH explained that the deal’s contract set a November 24 deadline, and that requests from Tiffany and the French government to delay the deal led to its pulling out. In return, Tiffany accused LVMH of not doing its part to win approval of the deal from antitrust authorities.

Tiffany’s famous 5th Avenue store in New York City

More details can be found in LVMH’s press release from yesterday: «After a succession of events which undermine the acquisition of Tiffany & Co, the Board of LVMH met to review the situation relating to the contemplated investment in light of these recent developments.

The Board learned of a letter from the French European and Foreign Affairs Minister which, in reaction to the threat of taxes on French products by the US, directed the Group to defer the acquisition of Tiffany until after January 6th, 2021. Furthermore, the Board noted Tiffany & Co.’s requested to extend the «Outside Date» in the Merger Agreement from November 24th to December 31st, 2020.

As a results 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 November 24th, 2020 and officially records that, as it stands, the Group LVMH will therefore not be able to complete the acquisition of Tiffany & Co.»

Key figure: Roger N. Farah, Chairman of the Board Tiffany & Co.

In course of Tiffany & Co.’s lawsuit in the Court of Chancery of the State of Delaware against LVMH Moët Hennessy-Louis Vuitton SE and related entities («LVMH»), Roger N. Farah, Chairman of the Board, said, «We regret having to take this action but LVMH has left us no choice but to commence litigation to protect our company and our shareholders. Tiffany is confident it has complied with all of its obligations under the Merger Agreement and is committed to completing the transaction on the terms agreed to last year. Tiffany expects the same of LVMH

He stated further, «We believe that LVMH will seek to use any available means in an attempt to avoid closing the transaction on the agreed terms. But the simple facts are that there is no basis under French law for the Foreign Affairs Minister to order a company to breach a valid and binding agreement, and LVMH’s unilateral discussions with the French government without notifying or consulting with Tiffany and its counsel were a further breach of LVMH’s obligations under the Merger Agreement. ‎Moreover, this supposed official French effort to retaliate against the U.S. for proposed new tariffs has never been announced or discussed publicly; how could it possibly then be an effort to pressure the U.S. into revoking the tariffs? Furthermore, as we are not aware of any other French company receiving such a request, it is all the more clear that LVMH has unclean hands.»

Tiffany CEO Alessandra Bogliolo in 2018

Tiffany emphasized that its business remained strong, with sales in the last three months of 2020 expected to exceed the same period last year and that the COVID-19 pandemic has not prevented other parties from making antitrust filings on a timely schedule.

Chief Executive Officer Alessandro Bogliolo underlined, »The fundamental strength of Tiffany’s business is clear. The company has already returned to profitability after just one quarter of losses, and we expect our earnings in the fourth quarter of 2020 will actually exceed the same period in 2019

The famous movie scene: Audrey Hepburn in «Breakfast at Tiffany’s».

Tiffany is seeking to expedite the Delaware proceedings to obtain a ruling prior to November 24, 2020 ordering LVMH to comply with its obligations and complete the transaction on the agreed terms.

An unpleasant turnaround of what we thought would become a love story of the luxury industry. I am very curious to see the outcome. I mean if LVMH walks away completely, Kering or Richmond might jump on the deal and acquire Tiffany. Stay tuned!

LoL, Sandra

Funny composite from the NY Post
Photos: Tiffany & Co., LVMH, Getty

LVMH Confirmed to Buy Tiffany & Co.

This morning, luxury giant LVMH Moët Hennessy Louis Vuitton SE confirmed that it has reached a $16.2 billion deal to buy American jeweller Tiffany & Co. There had been rumors for a long time about this blockbuster purchase. The largest luxury deal gives the famous French group, that is the world’s largest luxury conglomerate and Europe’s second-most valuable company, a bigger presence in jewelry and strengthen its position in the US.

Object of desire: An engagement ring by Tiffany & Co.

Jewelry is one of the best-performing luxury categories and is predicted to grow. The deal also allows LVMH to compete further with Swiss conglomerate Richemont, which owns Piaget, Cartier and Van Cleef & Arpels, and a lot of watch brands.

Nevertheless, Tiffany & Co. has been facing weak demand and will likely need heavy investment to revamp its business. It will be an interesting journey we will surely follow… stay tuned!

LoL, Sandra

Photos: Courtesy of Tiffany and © Sandra Bauknecht

Alber Elbaz Teams Up with Richemont

Great news for the fashion world: luxury conglomerate Richemont is teaming up with former Lanvin designer Alber Elbaz for a new venture at a time when luxury goods groups are vying to make star hires.

«I am very happy to partner with Richemont and to establish my ‘dream factory,’ which will focus on developing solutions for women of our times,» Elbaz said in a statement.

Me with Alber Elbaz in 2015

Elbaz was born in Casablanca, Morocco, in 1961 to a Moroccan Jewish family. He immigrated to Israel with his family at the age of ten and grew up in Holon. After his studies at Shenkar College of Engineering and Design, he had jobs at Geoffrey Beene, Guy Laroche, Yves Saint Laurent where he designed the Rive Gauche collection under Saint Laurent himself, and Krizia.

Lanvin F/W 2012 campaign

He then began designing for Lanvin, France’s oldest fashion house, in 2001 and transformed the Maison from a small label with only 15 wholesale accounts to a global fashion house known for feminine, comfortable and clever ready-to-wear that earned the approval of celebrities, critics and customers alike. Elbaz’s simple, feminine clothing, which has been compared to Lanvin’s 1920s outfits, has been lauded by the fashion press. Suzy Menkes wrote: «Elbaz is every woman’s darling. And that includes Nicole, Kate, Chloë Sevigny, Sofia Coppola and a slew of rising movie names.» In 2010, Elbaz launched for Lanvin a mass-market collection with H&M, and proved to be one of the retailer’s most popular annual runway collaboration series. In 2013, he created a much anticipated make-up collection for Lancôme.

Therefore the shock was huge when the announcement came that Elbaz had been let go from the fashion house due to major disagreements on strategy and targeted investment in 2015 with major shareholder Taiwanese businesswoman Shaw-Lan Wang. The house has since changed hands and failed to find its footing.

Shaw-Lan Wang and Alber Elbaz in happier times. Photo: BFA / The Cut

After Elbaz was abruptly fired from Lanvin, the industry has wondered when and how he might return to design full-time. Between then and now, he has turned his hand to designing accessories for LeSportsac, collaborated on a fragrance with luxury perfumer Frédéric Malle, and mentored at prestigious design schools. Recently, the star designer had his comeback For Elbaz, after having skipped several years of shows, watching the fashion industry shift from the sidelines. He designed a capsule collection of bags and shoes for luxury Italian brand Tod’s, called «Happy Moments.» Known for his charming and emotional personality, it couldn’t be a better match.

Alber Elbaz lives it up at Tod’s Happy Moments launch. Photo: Tod’s / Getty

«I like fashion, I like fashion people. But after Lanvin, I did not like fashion,» he told Elle Magazine in September 2019, «I needed to fall in love with fashion again.» To fall back in love with fashion took a lot of time. «Because you have to take a few years distance,» Elbaz continues earnestly.

A shoe from Tod’s Happy Moments collection created by Elbaz.

Now Elbaz has a partner for his next chapter. Today, Richemont  announced an agreement to form a joint venture with the designer, calling it AZfashion, which the Swiss luxury conglomerate described as «an innovative and dynamic start-up, meant to turn dreams into reality

As much as the fashion industry has anticipated Elbaz’s return, he and Richemont have their work cut out for them. The announcement about the new brand indicates a completely different approach in this new brand, which the designer told the New York Times will be project-based.

Feminine and dreamy designs: Lanvin F/W 2011 by Alber Elbaz

«Upon hearing Alber Elbaz describe his vision for fashion and the projects it inspires in him, I was again struck by his creativity and insight,» Richemont Chairman Johann Rupert said in a statement. «His talent and inventiveness, with his sensitivity towards women and their wellbeing, will be of great value to our group and its maisons.»

We will all be watching how Elbaz’ vision will transform… I am sure he will let us dream again… something that is desperately needed in today’s fashion world. Fashion should be fun and Elbaz will teach us!

LoL, Sandra

Me in a Lanvin by Alber Elbaz dress, click here for the post.

 Photo: © David Biedert Photography
Photos: Courtesy of the Brands, or otherwise mentioned

Falling for Mr Porter

One of my favourite online stores Net-à-Porter has started to receive the new pre-fall 2010 collections and I do not want you to miss this. The beginning of the season offers always so many stunning pieces. Here are some of them, already put together in complete outfits. The Burberry Prorsum jackets are divine just as the python prints by Stella McCartney. A belted cardigan is a must-have for next season, why not go for this Fendi one and think leather, leather, leather! The Burberry Prorsum pencil skirt below would be the perfect opportunity. Do you feel the same urge to push the “add to shopping bag” button like I do?!

Natalie Massenet

Natalie Massenet

As it has been a week of announcements, I have another one, this time for my male readers who probably feel a little left behind. Ten years to the day Net-à-Porter was founded and right after its acquisition by Richemont earlier this spring, the online shop`s founder Natalie Massenet and the Net-à-Porter family announced that they are adding a stand-alone menswear luxury retail site to the company, called Mr Porter. It will launch in January 2011 for next spring and will offer the most exclusive service along with style advice.  Brands like Balmain, Burberry, Lanvin, YSL and John Lobb, just to name a few, will make the stressed business man happy shopping from his desk. Or we could order for our men a little pre-selection to enjoy at home. I like it!mrporter.com_

LoL, Sandra