Swatch to purchase jeweler for $1 bln
ZURICH - Agence France-Presse
Flags wave in front of the headquarters of Swatch in Biel, Switzerland.Swatch Group, the world’s leading watchmaker, said yesterday it would acquire US jeweler and watchmaker Harry Winston for up to $1 billion (750 million euros).
The Swiss group will pay $750 million to acquire the company and add a maximum of $250 million to take over its net debt, according to its statement.
The transaction, which still needs the go-ahead from regulatory authorities, does not include the mining activities of the Harry Winston Diamond Corporation, it said.
Swatch stressed that it would take over the Harry Winston brand and all the activities related to its jewelry and watches business, as well as 535 of its employees worldwide.
Swatch chairwoman Nayla Hayek said the deal made sense since Harry Winston did brilliantly complement the prestige segment of the (Swatch) Group. Harry Winston’s chief executive Robert Gannicott also hailed the deal.
“The Harry Winston brand now has a new home that can provide the skills and support that it deserves to realize its true potential.”
Analysts were also enthusiastic about the purchase, although they said the price was steep.Kepler analyst Jon Cox told that overall the purchase makes sense.The acquisition, which is pricey, will add 5 percent to Swatch sales and it should have a positive impact on earnings this year, as Swatch can pay with cash, Vontobel analyst Rene Weber told.