Diamond jewelry retailer Signet Jewelers Ltd. (SIG) announced Tuesday that it has entered into an agreement to acquire Diamonds Direct USA Inc. for $490 million in an all cash transaction which is currently expected to close in the fourth quarter of Fiscal 2022, subject to customary closing conditions and regulatory approval.
Diamonds Direct is an off-mall, destination jeweler in the U.S. with a highly productive, efficient operating model with demonstrated growth and profitability which will be immediately accretive to Signet post-closing.
Signet plans to drive operating synergies by leveraging scale in purchasing, targeted marketing, Connected Commerce and jewelry services.
Following the acquisition, Diamonds Direct’s current leadership team will remain intact with President Italy Berger reporting directly to Signet CEO Virginia Drosos.
As a sign of commitment to the long-term vision of Signet and Diamonds Direct, Berger and other key Diamonds Direct executives have agreed, subject to the completion of the transaction, to invest a portion of their transaction proceeds in Signet shares.
Signet also now projects total revenue between $1.42 billion and $1.45 billion, with same store sales growth of 10 to 12 percent for the third quarter and between $7.04 billion and $7.19 billion, with same store sales growth of 35 to 38 percent for the full-year 2022.
Previously, the company projected total revenue between $1.26 billion and $1.31 billion, with same store sales growth of negative 3 percent to positive 1 percent for the third quarter and between $6.80 billion and $6.95 billion, with same store sales growth of 30 to 33 percent for the full-year 2022.
On average, analysts polled by Thomson Reuters expect the company to report revenues of $2.10 billion for the third quarter and $6.96 billion for the year.
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