What do you buy the luxury group that has everything? More diamonds, apparently.

LVMH, already the biggest beast in global luxury, has announced it is taking over Tiffany & Co, where Wall Street bond traders sink a few bucks to improve their chances of turning girlfriends into fiancées. The American brand will become the 76th maison of the Parisian group, joining Louis Vuitton, Dior and Veuve Clicquot champagne.

The deal is as richly priced as a flawless gem. LVMH will pay $16.9 billion including net debt, equivalent to nearly four years’ sales at Tiffany. Nonetheless, the takeover was greeted with the enthusiasm befitting a suitable engagement.

Luxury, once little more than a cottage industry dominated by family firms in Europe, has become the preserve of a few giant conglomerates.

In recent decades there has been a sense of inevitability when another well-known company has fallen into the clutches of LVMH or its rivals, Kering (home of Gucci and Balenciaga among others) and Richemont (which owns Cartier and Montblanc).

“LVMH dominates a structurally favored sector, buoyed by globalization and income inequality,” says Luca Solca of Bernstein, a research firm. Its success is the result of being the right size — big — in the right business at the right time.

Start with the industry. Sales of luxury goods, such as handbags, posh watches and Hermès scarves, have grown by about 6% a year since 1996 according to Bain, a consultancy. It estimates the industry will be worth more than $281 billion this year. Chinese shoppers, who barely featured in 2000 but now account for a third of all sales, have added much of the fizz.

Analysts think brands can do better within a conglomerate. Take Tiffany. Its shareholders had pestered management to improve margins and raise sales fast, unduly hurrying its turnaround efforts.

Scale has more mundane advantages, too. Conglomerates have more clout when negotiating, for example, with landlords of new malls in China. They can browbeat magazines for better advertising rates. Hefty costs associated with building e-commerce sites can be shared.

Such advantages suggest more consolidation. But there are limits for LVMH and others. One is supply. Another limit, which is particular to LVMH, is whether any group can handle so many different businesses.

So far the mood is for building empires, not dismantling them. Some wonder if Richemont and Kering might merge to boost their prospects.