Karan accepts LVMH bid
|
|
April 2, 2001: 10:05 a.m. ET
U.S. fashion house agrees to sweetened offer of $243M
|
LONDON (CNN) - Donna Karan International Inc. accepted a sweetened takeover offer Monday from France's LVMH Moet Hennessy Louis Vuitton in a deal that values the U.S. firm at $243 million.
Luxury goods firm LVMH will pay $10.75 a share, significantly more than the $8.50 a share it offered in its original proposal last December.
Donna Karan (DK: Research, Estimates) shares closed Friday at $8.98 and have a 52-week range of $4.25 to $9.25. Donna Karan shares were up $1.46 to $10.44 in early trading Monday.
"I have always admired LVMH and the environment it has created for designers in supporting their creativity, emphasizing their individuality, respecting their brands and providing the resources to develop global luxury businesses," Donna Karan, chairman of the board and chief design officer of Donna Karan International, said in a statement.
Donna Karan's board had little choice but to agree to LVMH's new terms since Karan and her husband, Stephan Weiss, already had agreed to sell the Donna Karan trademarks to LVMH for about $450 million.
Karan and Weiss have agreed to buy up to 14.3 percent of the merged company's shares.
LVMH will not have to pay any more money under the new deal because Karan and Weiss agreed to return $50 million of their $450 million to LVMH if Donna Karan were sold by June, which will more than cover the extra $2.10 a share LVMH is paying for the public company, a Wall Street Journal report said.
After the merger, which is expected to be completed in the third quarter, subject to shareholder approval, LVMH will operate Donna Karan as a separate brand.
|
|
|
|
|
|