LVMH promotes Arnault scion to lead Tiffany after $16 bn deal; ready to give jewellery brand a makeover
Alexandre Arnault will be executive vice president at Tiffany.
By Reuters | Updated:
Reuters
Analysts expect that LVMH, home to brands including Fendi and Veuve Clicquot champagne, will review everything from Tiffany's network of stores to strategies in areas such as online sales as it repositions the brand and streamlines it.
PARIS/NEW YORK: LVMH installed the son of company founder Bernard Arnault in a new leadership team at Tiffany on Thursday after the French luxury goods group concluded its $15.8 billion acquisition of the U.S. jeweller.
The conglomerate also picked two executives from its Louis Vuitton handbag brand to run Tiffany, and said it would overhaul the design team ahead of a makeover which analysts expect will focus on courting young shoppers and Asian customers.
The official closing of the deal, meant to boost LVMH's standing in a segment it was less exposed to than fashion or spirits, follows a bitter legal dispute. LVMH backed away as the COVID-19 pandemic hammered luxury goods sales, but ultimately renegotiated a discounted purchase price.
Alexandre Arnault, one of four scions with roles at LVMH, who had already been stepping up his profile after previously running luggage label Rimowa, will be executive vice president at Tiffany, in charge of product and communication.
(L-R) Rihanna, Alexandre Arnault and Bella Hadid at the Louis Vuitton Menswear Spring/Summer 2019 show as part of Paris Fashion Week in 2018 in Paris, France. A fluent English speaker, the 28-year-old accompanied his father on a U.S. trip to meet outgoing President Donald Trump in 2017 shortly after his election.
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Under his tenure, Rimowa paired up with sportwear brand Supreme for a collaboration and made a big social media push, a formula luxury groups have favoured to draw younger clients.
In his new role the young Arnault will work under two LVMH heavyweights, including Michael Burke, chairman and CEO at Vuitton - the group's biggest money spinner - who will now also chair Tiffany.
Anthony Ledru, who ran Vuitton in the U.S. as well as the label's global commercial activities, will take over as CEO from Alessandro Bogliolo, who is set to leave on Jan. 22, LVMH said.
Ledru had a previous stint at Tiffany and has also worked for rival jeweller Cartier.
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"The idea of pairing experienced managers with up and coming family members (and possible future leaders) creates a fruitful environment," Bernstein analyst Luca Solca said in a note.
According to court papers from the legal battle, Bogliolo's payout stemming from a change of control could top $44 million.
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GROWTH TACTICS Analysts expect that LVMH, home to brands including Fendi and Veuve Clicquot champagne, will review everything from Tiffany's network of stores to strategies in areas such as online sales as it repositions the brand and streamlines it.
The conglomerate said artistic director Reed Krakoff was set to leave the company along with Chief Brand Officer Daniella Vitale. It did not name replacements.
"We are optimistic about Tiffany's ability to accelerate its growth," LVMH's Bernard Arnault said in a statement.
Tiffany's last quarterly earnings indicated the retailer had recovered from some of the impact of the pandemic, with a 70% rise in sales in China and an e-commerce sales surge of 92% in the quarter.
LVMH will draw on its experience with jeweller Bulgari, acquired in 2011, where it has lifted margins and sales.
LVMH is unlikely to shy away from any moves to improve costs, although it also has the cash to invest heavily in marketing. It has praised Tiffany's branding - the robin-egg-blue used on its boxes for instance - as a big strength.
Tiffany’s Blue Now Belongs To LVMH; Ambani, PeeCee, Gaga's Connections To The Iconic Brand
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French luxury giant LVMH, on Monday, acquired iconic American jeweller Tiffany for $16.2 billion. The acquisition, which took just over a month and three revised bids to get done, is the biggest-ever deal for the French group owned by Bernard Arnault.
According to a report in news agency Reuters, Tiffany was codenamed "Tea" and LVMH was "Latte" during the talks that led to the takeover.
Reuters also reported that LVMH's 70-year-old billionaire boss was himself 'focused on ensuring he was getting control of Tiffany's most valuable assets: all the patented elements that came with the Tiffany brand, notably its robin's egg blue boxes'.
The third-richest man in the world, Arnault, emphasised on the importance of the blue in an interview with the news agency, saying, "We're the owner of a colour. It's a pretty rare thing."
LVMH had forayed into high-end jewellery in 2011, when it acquired Italian jeweller Bulgari.
French luxury giant LVMH, on Monday, acquired iconic American jeweller Tiffany for $16.2 billion. The acquisition, which took just over a month and three revised bids to get done, is the biggest-ever..
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Earlier this year, the iconic jeweller was making national headlines due to reports of it coming to India in partnership with India's richest man, Mukesh Ambani.
According to news reports, Ambani-led Reliance Brands has plans to bring the iconic blue box to Delhi and Mumbai by mid-2020.
'Quantico' star Priyanka Chopra also has a personal connect with the brand. Not only did the star host her bridal shower at the the Blue Box cafe, situated inside the brand's flagship store, but her singer-hubby Nick Jonas also shut down the Fifth Avenue outpost to pick the perfect 4-carat ring for her.
Earlier this year, the iconic jeweller was making national headlines due to reports of it coming to India in partnership with India's richest man, Mukesh Ambani.
According to news reports, Amban..
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Tiffany's storied history dates back to 1837, when the first store opened on Broadway in New York. Founded by Charles Lewis Tiffany, the iconic brand initially sold stationary, handkerchiefs and other finery.
On opening, it became the first company to clearly mark prices on its products, leaving no option of bargaining. It also started a new norm by only accepting payments in cash.
Over the next decade, the company shifted to jewellery. In 1848, it started acquiring exotic European collections and crown jewels, including diamonds worn by Marie-Antoinette.
Almost unstoppable, two years later, Tiffany had opened a store at rue de Richelieu in Paris. This expansion continued, with a London store in 1868, and eventually a watch factory in Geneva, a few years later.
The legendary brand saw a new direction with Charles's painter-son, Louis Comfort Tiffany, becoming the company's first official design officer. At the end of the 19th century, stained glassworks and lamps by Tiffany Jr. became synonymous with the 'Gilded Age' in America, with some of them even being installed at the White House. They were later removed early in the 20th century.
(Image: AP)
Tiffany's storied history dates back to 1837, when the first store opened on Broadway in New York. Founded by Charles Lewis Tiffany, the iconic brand initially sold stationary, handkerchiefs and othe..
Read More
The rise of Tiffany parallels that of New York. The American jeweller set up its flagship store on Fifth Avenue in 1940, creating a landmark that attracts tourists even today. This store now accounts for almost 10 per cent of the brand's overall sales.
Over time, the aspirational value of the brand increased with the emergence of America’s high society as its customers. From the Kennedys and Richard Nixon to Elizabeth Taylor and Richard Burton, the brand became synonymous with classy indulgence.
In 1862, President Abraham Lincoln purchased a Tiffany seed pearl necklace and earrings for his wife for the inaugural ball.
(Image: AFP)
The rise of Tiffany parallels that of New York. The American jeweller set up its flagship store on Fifth Avenue in 1940, creating a landmark that attracts tourists even today. This store now accounts..
Read More
The brand's flagship store also houses the famous Tiffany yellow diamond, that Charles bought in 1878 for $18,000. The 287.42-carat diamond, said to be one of the world’s finest gemstones, was cut into a cushion-shape of 128.54 carats, and named the 'Tiffany Diamond'.
Over 300 guests throng the store each day for a glimpse of the diamond.
The rare stone has only ever been worn three times in history. The most-recent being Lady Gaga, who arrived at the Oscars this year with the diamond around her neck.
The gem was worn for the first time at the 1957 Tiffany Ball in Newport, Rhode Island by Mary Whitehouse. Following her, Audrey Hepburn became the second person to be granted permission to wear the diamond, for promotion of 'Breakfast at Tiffany's'. The actress wore the stone in a Jean Schlumberger necklace.
(Image: Reuters)
The brand's flagship store also houses the famous Tiffany yellow diamond, that Charles bought in 1878 for $18,000. The 287.42-carat diamond, said to be one of the world’s finest gemstones, was cut in..
Read More
In 1961, Tiffany & co made its cinematic debut with another icoc, Audrey Hepburn. 'Breakfast at Tiffany’s', the first movie ever filmed at Tiffany’s flagship store, continues to be a classic till date.
The store went on to feature in other films including 'Sleepless in Seattle' and 'Sweet Home Alabama'.
In 1961, Tiffany & co made its cinematic debut with another icoc, Audrey Hepburn. 'Breakfast at Tiffany’s', the first movie ever filmed at Tiffany’s flagship store, continues to be a classic till dat..
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