Paris (AFP)

With Tiffany, bought for $ 16.2 billion, the giant LVMH offers its third prestigious jeweler and rises to the height of Richemont, its Swiss competitor owner of Cartier, in a high-end jewelry market in booming.

"LVMH is by far the world's number one luxury, but there was a small hole in the racket: although he did very well with Bulgari, the band was not on a status of + leader in jewelery" , comments AFP Arnaud Cadart, portfolio manager at Flornoy & Associés.

Six houses make up the LVMH Watches and Jewelry division - Bulgari, Chaumet, Tag Heuer, Hublot, Zenith and Fred - totaling 4.1 billion euros in sales in 2018. By integrating Tiffany, the division will double in size with the 4 , 4 billion euros in sales earned last year by the American jeweler.

For its part, Richemont owns the Cartier, Van Cleef & Arpels and Buccellati jewelers, as well as eight watch brands, these two branches having achieved sales of € 10 billion for the year ended March 31, 2019.

"After the success of its acquisition of Bulgari in 2011 to develop its presence in the luxury jewelery segment, LVMH is now seeking to consolidate its position, and among all luxury sectors, jewelery is growing fastest, with about 7% growth in 2018, "comments Marguerite Le Rolland, from Euromonitor International.

For Fflur Roberts, director of the luxury division at Euromonitor also, this + deal + places the largest luxury conglomerate in the world in a much more competitive situation in the segment of luxury jewel, alongside the Swiss Richemont.

However, "it's not just a race to the waist: LVMH certainly makes this buy with a spirit of competition but he also has a real plan for Tiffany, he thinks he can do better and create value" , says Arnaud Cadart.

The portfolio manager at Flornoy & Associés believes that the luxury giant will notably "streamline Tiffany's offer, make a European-style management with a much more selective jewelery, a very high-end sales mode and better communication. targeted ".

- "New creative breath" -

"Once LVMH has set up its standards, with a very disciplined management, a new breath with more creativity, and especially the development towards Asia, in three-four years, Tiffany will be worth 50% more" he says.

Luca Solca, a luxury analyst at Bernstein, also sees a number of "priorities" at Tiffany for Bernard Arnault's group, including "the modernization of marketing and social networks" and "watch development".

The New York jeweler, founded in 1837, has been trying for years to modernize its image and attract a younger clientele.

The iconic house had reported in March annual sales of $ 4.4 billion, its growth being held back by the strong dollar and a decline in spending by tourists in the United States.

If the brand has had "ups and downs" and "there are so many things to do", Bernard Arnault believes that his group is able to "make it shine".

"We have some experience in jewelery: we have multiplied the operating profit of Bulgari by five since its acquisition in 2011," he said to AFP.

The billionaire also knows very well the leaders of Tiffany: Alessandro Bogliolo, general manager of the jeweler, worked 17 years for Bulgari until its acquisition by LVMH in 2011, then was director of operations for North America of Sephora, Another brand owned by the luxury giant.

As for Francesco Trapani, currently director of Tiffany and the jeweler's largest single shareholder (0.21%), he was boss of Bulgari at the time of his acquisition, then headed LVMH's Watches and Jewelry division between 2011 and 2014, and was also one of Bernard Arnault's advisors until 2016.

With 76 prestigious houses in its purse, LVMH will he pause in its acquisitions? "Mr. Arnault is not someone who can be easily satisfied, and I see it still launched in the consolidation of the industry", considers Luca Solca for Bernstein.

© 2019 AFP