British jewelry retailer Signet Group announced Thursday that it bought privately held U.S. jewelry firm Marks & Morgan for $115 million.
Marks & Morgan is the ninth-largest specialty retail jeweler in the U.S. with 137 stores, predominantly in mall locations. Its acquisition gives Signet a market presence in the southeastern U.S., where it had previously been under-represented. Signet will convert about 80 of Marks & Morgan's stores into its Kay Jewelers national format, raising the number of Kay stores in the country to 628 from 548.
Signet also reported a 7.5% rise in comparable sales in the first quarter, with U.S. sales up 7.3% and UK sales up 8%. The U.S. accounts for about 67% of annual sales, while Britain accounts for 33%.
Signet, which operates the H Samuel and Ernest Jones stores in Britain, said first quarter pre-tax profits rose to $25.3 million from $14.2 million in 1999. Terry Burman, Signet CEO, told Reuters increased diamond sales helped boost sales in Britain and America.
Burman said the Marks & Morgan deal would be reflected in Signet's earnings in the final quarter of 2001. Completion of the sale is expected within 60 days, pending federal regulatory approval.
- by Mark E. Dixon