French luxury group LVMH has agreed to acquire jeweler Tiffany & Co for $16.2 billion in cash. Tiffany shareholders will receive $135 in cash for every share they own.

The acquisition aims to strengthen LVMH’s position in the jewelry and watches segments. The deal will also increase the luxury company’s presence in the United States.

“We will be proud to have Tiffany sit alongside our iconic brands and look forward to ensuring that Tiffany continues to thrive for centuries to come,” said LVMH chairman and CEO Bernard Arnault.

The acquisition was approved by the boards of both companies. Tiffany’s board recommended to its shareholders to also back the deal.

LVMH is expects the acquisition to close in mid-next year. The deal is subject to customary closing conditions and the approval of Tiffany’s shareholders. It also needs regulatory clearance.

Alessandro Bogliolo, the CEO of Tiffany, said that the merger will “provide further support, resources and momentum.”

Earlier this month, Tiffany wanted LVMH to sweeten its original bid to stay on the negotiation table. The jewelry chain rejected the $120-per-share all-cash offer, which valued Tiffany at $14.5 billion. Tiffany’s board deemed the original offer too low to even become the basis for discussions.

Citi and JP Morgan served as financial advisors and Skadden, Arps, Slate, Meagher & Flom acted as legal counsel to LVMH. Centerview Partners and Goldman Sachs advised Tiffany on the financial matters, while and Sullivan & Cromwell served as legal counsel.