French Minister Says LVMH Letter Controversy Excessive

(Bloomberg) --

French Foreign Minister Jean-Yves Le Drian branded as “excessive” the controversy surrounding a letter he sent to LVMH that the luxury group cited when it called off its proposed $16 billion acquisition of jeweler Tiffany & Co. this month.

LVMH said on Sept. 9 it could no longer complete the deal, due to close on Nov. 24, after the board learned of a letter from Le Drian directing it to defer the transaction until after Jan. 6 due to the threat of U.S. tariffs.

“It’s my duty to protect French interests,” Le Drian told Le Parisien newspaper in an interview published on Sunday. “Regarding the trans-Atlantic situation, the trade disagreements we have are known. It was therefore my role to inform LVMH of my political appraisal of the moment.”

Le Drian said he spent part of his job discussing international affairs with the bosses of major French companies.

“I have regular exchanges with the managers of Orano, Total, Veolia and other companies,” he said. “I’m responsible for France’s international relations.”

Le Drian told parliament last week he had responded to a request from LVMH when writing the letter. LVMH had described it as “unsolicited” and denied a Bloomberg report that Chief Executive Officer Bernard Arnault leaned on the government for support in wiggling out of the takeover.

Tiffany’s lawyers argued that the letter doesn’t provide proper legal grounds for nixing the deal and that LVMH is using fallout from the coronavirus pandemic as leverage to negotiate better terms. The companies are now preparing to go to court on Jan. 5.

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