LVMH has reached an agreement to buy the iconic jewelry brand Tiffany & Co. for $135 per share in cash, or $16.2 billion, the companies said.

In October, LVHM confirmed it had held preliminary talks with Tiffany over a possible transaction, but the resulting offer, reportedly for $120 per share, was rejected by the company’s board.

“This transaction, which occurs at a time of internal transformation for our legendary brand, will provide further support, resources, and momentum for those priorities as we evolve towards becoming The Next Generation Luxury Jeweler,” Tiffany chief executive officer Alessandro Bogliolo said in a statement.

LVHM said the addition of Tiffany would strengthen its position in jewelry and further increase its presence in the United States.

Tiffany went through a series of tough quarters in 2015 and 2016 before announcing a turnaround plan under new CEO Bogliolo, a former Bulgari executive, in July 2017. But in June, the company reported a steep drop in sales to tourists from China amid the ongoing trade war between the two countries.

“The tourists in the U.S. represent a low double-digit percentage of our total sales in the U.S. and we have seen a sharp decrease to sales to tourists in the U.S. in the range of 25 percent. Even sharper for Chinese tourists,” Bogliolo said at the time.

The deal is expected to close in the middle of 2020.

“It looks like a good match really,” Raphael Pitoun, a portfolio manager at CQS New City Equity, told CNBC Europe’s “Squawk Box” on Monday. “The branding of Tiffany has weakened a bit over the last few years and LVMH has great expertise in helping brands to develop internationally, they did that with Bulgari already.”

LVMH stock was up more than 2% in midday trading Monday. Tiffany stock was up nearly 6%.

Citi and JPMorgan are serving as financial advisors to LVMH. Centerview Partners and Goldman Sachs are serving as financial advisors to Tiffany.

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