By Giulia Petroni 
 

LVMH Moet Hennessy Louis Vuitton SE said Thursday that it plans to countersue U.S. jeweler Tiffany & Co. in Delaware "as a result of its crisis mismanagement."

The news came a day after the luxury-goods giant said it was backing out of its $16.2 billion takeover deal for the company.

The French company said it was surprised by Tiffany's legal action on Wednesday, which it considers to be "totally unfounded."

LVMH added that its board examined Tiffany's current economic situation and found its first-half results and outlook for this year to be "very disappointing and significantly inferior to those of comparable brands of the LVMH group."

"LVMH will be therefore led to challenge the handling of the crisis by Tiffany's management and its board of directors," the company said. It reiterated that the conditions necessary for the acquisition deal aren't fulfilled.

Moreover, the company said Tiffany failed to follow an ordinary course of business, particularly by distributing substantial dividends even though it was loss-making.

 

Write to Giulia Petroni at giulia.petroni@wsj.com

 

(END) Dow Jones Newswires

September 10, 2020 07:45 ET (11:45 GMT)

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