Tiffany & Co. Reportedly Speculated To Be Takeover Target - Update

RTT News reports:

[TIF]6/26/2007 12:45:55 AM Monday, jewelry and specialty retail stores operator Tiffany & Co. Inc. (TIF) is once again reportedly speculated to be a takeover target.

Reports suggested that either France-based luxury goods conglomerate LMVH Moet Hennessy Louis Vuitton SA is interested in acquiring Tiffany or shareholder Nelson Peltz intends to increase his stake in the company. The company's stock gained more than 3% in Monday's regular trading session.

LMVH is the parent company of around 60 sub-companies that each manage a small number of prestigious brands. The group was formed after mergers brought together champagne producer Moet et Chandon and Hennessy, a manufacturer of cognac, a type of French distilled wine. In 1987, they merged with fashion house Louis Vuitton to form the current group. The group is partly owned by Christian Dior group and operates around 1,500 stores worldwide.

In February, a hedge fund run by billionaire financier Nelson Peltz, Trian Fund Management LP, revealed that it has bought a 5.54% stake in New York-based Tiffany to become the company's largest shareholder. According to the fund's filing with the SEC, it is seeking to help Tiffany improve its margins and earnings per share growth and address various operational and strategic issues, including optimizing global expansion opportunities and evaluating non-core businesses. The fund currently owns 7.5 million shares of the company. Trian Fund also noted that Tiffany's common stock was under valued and that it represented an attractive investment opportunity.

For the recent first quarter, Tiffany & Co. reported a 15% increase in net earnings to $49.66 million from $43.14 million a year ago. On a per share basis, earnings climbed 20% to $0.36, based on 139.72 million shares, from $0.30, based on 144.37 million shares, in the prior-year quarter. Net sales for the quarter grew 15% to $620.88 million from $539.24 million in the previous-year quarter.TIF closed Monday's regular trading session at $51.91, up $1.93 or 3.86% on a volume of 5.64 million shares.