The coronavirus pandemic has bludgeoned stock prices, sending shares of jeweler Tiffany & Co. (TIF) down by 20%.

Luxury goods conglomerate LVMH Moet Hennessy Louis Vuitton (LVMUY -0.79%) had agreed to buy Tiffany last year for $135 per share cash, or $16.2 billion, but the recent drop in stock price could give the company a rare opportunity to buy Tiffany shares on the open market. 

While rumors to that effect have spread, LVMH, which owns 75 different luxury brands, says it will not pursue that course of action.

A set of hands cleans a diamond ring with a blue cloth.

Image source: Getty Images.

Not grabbing for the opportunity

In order to buy Tiffany shares on the open market -- and do an end run around the purchase agreement -- LVMH would actually need permission from Tiffany. 

Reuters had reported the owner of Sephora, Dom Perignon, and Givenchy was in discussions with the jeweler for permission following it reporting its earnings last Friday.

LVMH is raising 9.3 billion euros in bonds to finance the acquisition, and buying Tiffany on the open market at a lower price would be a significant savings at a time when markets and stock valuations have been battered.

However, LVMH issued a statement this morning saying it was not pursuing such a strategy.

"Rumours circulated recently indicating that LVMH would consider buying Tiffany shares on the open market," the statement said. "These rumours lead LVMH to recall that, in accordance with the agreement concluded with Tiffany in November 2019, LVMH is currently committed not to buy Tiffany shares."

While Tiffany beat analyst expectations in the fourth quarter, it warned the pandemic would result in a serious hit to earnings this year.