COACH, LVMH TIE-UP SEEN UNLIKELY: Financial sources were extremely skeptical of a report from primeretailer.com claiming that LVMH Moët Hennessy Louis Vuitton had “shown interest” in Coach Inc.

The Bernard Arnault-led LVMH is acquisitive and well funded enough to be a regular feature in the M&A rumor mill and many of the mega deals that are whispered about never come to fruition. Even so, the hint of a deal for Coach was enough to send the company’s stock up 3.5 percent to $34.78 by 1:15 p.m. on Wall Street, while the Dow Jones Industrial Average rebounded 1.1 percent, or 189.83 points, to 17,722.98 after Wednesday’s rout.

Stifel analyst David Schick noted that Coach’s creative director, Stuart Vevers, came to the handbag maker from LVMH’s Loewe business. He also noted the brand is moving to higher priced bags and $2,000 shearling coats.

“It is more likely that Coach is seen as going up-market than in its past,” Schick said in the note, which was obtained by WWD. “There has been media discussion of LVMH interest in Burberry in the past. At the very least this could be a valid suggestion that Coach’s new direction is turning heads.”

LVMH declined to comment.

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