LVMH Moët Hennessy Louis Vuitton on Thursday announced the completed $15.8 billion acquisition of Tiffany & Co. and an immediate shakeup of the American jeweler's executive and creative leadership.
Anthony Ledru, previously executive vice president of global commercial activities at Louis Vuitton and once a senior vice president of North America at Tiffany, has replaced Alessandro Bogliolo as CEO; Bogliolo will leave the company Jan. 22, according to a company press release.
Alexandre Arnault, (son of LVMH chief Bernard Arnault), has left his post as CEO of LVMH-owned luggage brand Rimowa to lead Tiffany's product and communications. Louis Vuitton Chairman and CEO Michael Burke will chair Tiffany's board. Also leaving Tiffany are Chief Artistic Director Reed Krakoff and Chief Brand Officer Daniella Vitale.
There were several weeks in 2020 when LVMH worked hard to get out of this proposal, but in the new year the French luxury house has wasted no time in making its ownership clear.
Throughout much of last year the two companies skirmished in and out of court. LVMH lobbed harsh words via press release, claiming the French government's support in nixing the deal (something the French government itself denied) and accusing the iconic U.S. jeweler of mismanaging its business during the pandemic. Tiffany revenue in the first half of the year fell 37% while sales at LVMH's watch and jewelry business fell 38% in a comparable period.
Things settled down by the end of October, when Tiffany shaved $400 million off the acquisition price. Fortunately LVMH had continued its work to get a series of necessary global approvals. In a statement Thursday, Ledru expressed "deep confidence in LVMH's commitment to protect the brand, drive its growth strategy and apply the highest standards of retail excellence to Tiffany."
The conglomerate has a lot to work with. Earlier this week, Tiffany said it saw record net sales worldwide for the holiday period. From Nov. 1 through Dec. 31, net sales rose about 2% and comps rose 4% year over year. In the Americas, net sales dropped 5% and comps fell 4%. The company during the season attracted not just upper income shoppers less affected by the pandemic's economic fallout but also middle-income consumers willing to splurge on items perceived to have long-lasting value, according to research from GlobalData Managing Director Neil Saunders.
"[G]iven the absence of the important tourist trade in big cities this was a very good outcome that underlines the strength of domestic demand," Saunders said in emailed comments. "Overall, the numbers are justification that Tiffany's underlying strategy is working well and show that LVMH is not inheriting a poorly performing brand, but rather one that is on a solid trajectory."
Bernard Arnault in a statement called Tiffany "a brand that is synonymous with love and whose Blue Box is revered around the world" and expressed optimism "about Tiffany's ability to accelerate its growth, innovate and remain at the forefront of our discerning customers' most cherished life achievements and memories."