LVMH Plans to Countersue Tiffany for Handling of Coronavirus Pandemic-- Update
September 10 2020 - 9:03AM
Dow Jones News
-LVMH plans to file a lawsuit against former acquisition target
Tiffany & Co over its management during the coronavirus
pandemic
-LVMH said it would pull out of its acquisition of Tiffany,
which has filed a lawsuit to try and enforce the deal
-The French giant said it considers the U.S. jeweler's legal
action in Delaware to be unfounded
By Giulia Petroni
LVMH Moet Hennessy Louis Vuitton SE said Thursday that it plans
to countersue Tiffany & Co. over the U.S. jeweler's management
of its business during the pandemic, a day after the French company
said it was pulling out of a merger deal.
The luxury-goods giant said its board examined Tiffany's current
economic situation and found its first-half results and outlook for
this year to be "very disappointing and significantly inferior to
those of comparable brands of the LVMH group."
It added Tiffany didn't follow an ordinary course of business,
particularly by distributing substantial dividends while booking
losses.
"LVMH will be therefore led to challenge the handling of the
crisis by Tiffany's management and its board of directors," the
company said.
The news comes after LVMH on Wednesday said it was backing out
of its $16.2 billion takeover deal for the company, claiming that
both Tiffany and the French government asked to delay the
acquisition beyond the agreed deadline.
Tiffany on Wednesday said it filed a lawsuit in Delaware to
enforce the agreement, alleging that LVMH was using a letter
received from the French government as a pretext to back out of the
deal.
LVMH said it was surprised by Tiffany's legal action, which it
considers to be "totally unfounded," and reiterated that the
conditions necessary for the acquisition deal haven't been
fulfilled.
LVMH said it also plans to file its lawsuit in Delaware.
Write to Giulia Petroni at giulia.petroni@wsj.com
(END) Dow Jones Newswires
September 10, 2020 08:48 ET (12:48 GMT)
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