- The European Commission will decide by October 26 whether to clear LVMH's $16 billion acquisition of Tiffany & Co, it said on Monday.
- LVMH said it still plans to back out of the deal.
- The news comes after Tiffany filed a lawsuit accusing LVMH of deliberately stalling antitrust proceedings so that it wouldn’t have to pay the agreed price tag. LVMH calls the suit "totally unfounded."
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EU antitrust regulators will decide by October 26 whether to clear LVMH's $16 billion acquisition of Tiffany & Co. — but LVMH remains confident that it can still withdraw from the takeover.
French luxury goods conglomerate LVMH, which owns 75 brands including Louis Vuitton and Dior, submitted its proposed acquisition of Tiffany for antitrust review to the EU on Friday, and a Monday filing gives October 26 as an initial deadline.
It follows Tiffany lodging a lawsuit accusing LVMH of stalling antitrust proceedings so that it wouldn't have to pay the agreed price tag. LVMH, which said it was pulling out the deal in September, has called the lawsuit "totally unfounded."
LVMH is seeking regulatory approval, but has "full confidence" that the courts will rule it can pull out of the deal. It has cited two reasons for why it no longer wants to buy Tiffany: First, a letter from the French government asking it to delay the acquisition into 2021 because of potential US tariffs against French products, and second, a request from Tiffany to extend the "outside date" of the merger — after which either party can walk away if the deal is not completed — to December 31.
LVMH had previously agreed to secure the regulatory clearances for the acquisition, but as of August 24 it had not filed for antitrust approval in three of the required jurisdictions, Tiffany said.
Eight of the ten required antitrust clearances have now been obtained, LVMH said Friday, leaving just Taiwan and the EU remaining. It said it expects to receive approval from Taiwan well before November 24, the deadline for the deal.
The European Commission can either clear the deal with or without concessions, or it can open a four-month long investigation.
On September 16, Tiffany said that "LVMH is continuing its blatant ongoing efforts to avoid paying the agreed-upon price for Tiffany" after the conglomerate asked Delaware Chancery Court to hold a trial about the deal in "six or seven months." Tiffany described this as LVMH's "latest attempt" to delay the acquisition.
The next day, LVMH responded by accusing Tiffany of "meritless allegations and aggressive misdirection campaign tactics," and said that the jeweler's executive board is "clearly seeking to avoid having to answer, notably to their shareholders, for their bad results and mismanagement."
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