Jewellery brand, Tiffany & Co, has seen a drop in its share price following report by Women’s Wear Daily that LVMH’s deal to buy the luxury jewellery company is uncertain.
According to WWD, LVMH board members arranged to meet on Tuesday, June 2, 2020, to discuss the proposed deal. The report cited unidentified individuals.
Board members are concerned about the Covid-19 pandemic that has disrupted the US economy and growing unrest over police violence, report says.
The report added that the board members have also expressed concern about Tiffany’s ability to cover its debt covenants at the end of the transaction.
Tiffany shares, which were halted for several minutes due to volatility, fell as much as 13 percent, the most intraday since 2015, before closing down 8.9 percent on Tuesday.
The stock slid 3.9 percent this year through Monday, while the S&P 500 Index fell 5.4 percent.
The economic fallout from the pandemic has disrupted or derailed a number of prominent deals, including L Brands Inc.’s agreement to sell a majority stake in Victoria’s Secret to private-equity firm Sycamore Partners, according to report.
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