Tiffany & Co. plunged after Women’s Wear Daily reported LVMH’s deal to buy the luxury jewellery company is uncertain as the U.S. economy faces widespread upheaval.
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As reported by WWD, LVMH board members arranged to meet on 2nd June to discuss the proposed deal. members are concerned about the Covid-19 pandemic that has disrupted the U.S. economy and growing unrest over police violence, WWD said. They also expressed concern about Tiffany’s ability to cover its debt covenants at the end of the transaction.
Tiffany’s representatives did not immediately respond to a request for comment from Bloomberg. LVMH declined to comment.
Tiffany shares, which were halted for several minutes due to volatility, fell as much as 13%, the most intraday since 2015, before closing down 8.9% on 2nd June.
The New York-based jewellery website says, as of June 1, its stores are temporarily closed until further notice and its social media accounts joined other brands in statements supporting black communities.
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LVMH’s planned purchase of Tiffany for more than $16 billion had been already delayed from its original plan.
(Source: Bloomberg)