News

Advanced Search

Signet to Buy James Allen for $328M

Aug 24, 2017 8:43 AM   By Rapaport News
Comment Comment Email Email Print Print Facebook Facebook Twitter Twitter Share Share


RAPAPORT...
Signet Jewelers will acquire the owner of online jewelry retailer James Allen for $328 million, the companies announced Thursday.

Signet will purchase R2Net in an all-cash deal, taking control of both JamesAllen.com and Segoma Imaging Technologies, which creates 3D displays of diamonds and jewelry for consumers buying on the web. With plans to implement R2Net’s technology across its own retail platforms, Signet expects the positive impact of the takeover to outweigh its costs within the first year, it said.

“This is a highly strategic acquisition for Signet,” said Virginia Drosos, the US jewelry giant’s CEO. “The James Allen brand and R2Net’s technologies and innovative approach present a unique opportunity to rapidly enhance our digital capabilities and create a distinctive customer shopping experience which more seamlessly integrates our digital and physical retail platforms.”

Signet and R2Net will “redefine the jewelry shopping experience” and help Signet improve the way its online and offline selling platforms work together, she added.

R2Net’s headquarters are in New York, with innovation centers in Israel and customer-service operations in Frederick, Maryland. It boasts proprietary 360-degree diamond-display technology, in addition to a virtual ring sizer and a mobile application for trying on rings.

“By joining forces with Signet, we believe we will be able to accelerate the growth of JamesAllen.com and our adjacent R2Net businesses while continuing to build on our unique culture and technology,” said Oded Edelman, who co-founded R2Net in 2006 along with James Schultz, Michele Sigler and Dean Lederman.

R2Net brands will mainly operate as an independent division of Signet under its current leadership. Edelman will remain president of James Allen and become Signet’s chief digital-innovation adviser, reporting directly to the CEO. Edelman and the other founders of R2Net have agreed to invest a portion of their transaction proceeds in Signet shares, Signet said.

Signet expects to complete the transaction in late September, subject to certain conditions and regulatory approval. Signet is receiving a loan from JPMorgan Chase Bank to finance the takeover and plans to repay it by the end of fiscal 2018.

The retailer has struggled with digital sales of late. Overall performance during the most recent holiday season was sluggish, partly as a result of its e-commerce sites failing to cope with the high levels of traffic. The company shuffled some of its senior management earlier this year and brought in new faces to shake up its IT operations and improve its digital strategy. Drosos, who took over as CEO at the beginning of this month, has said she intends to make Signet more “innovative, digital-first and data-driven.”

Signet announced better results Thursday, crediting improvements to its e-commerce platforms and a strong Mother’s Day, among other factors. Revenue rose 1.9% to $1.4 billion in the second fiscal quarter, which ended July 29, while same-store sales grew 1.4%. E-commerce sales jumped 18% to $82.2 million, while group profit increased 14% to $93.4 million.

However, the jeweler’s first-half sales — for the 26 weeks to July 29 — fell 5% to $2.8 billion, with profit sliding 25% to $171.9 million.
Comment Comment Email Email Print Print Facebook Facebook Twitter Twitter Share Share
Tags: James Allen, r2net, Rapaport News, Signet, Signet Jewelers
Similar Articles
Comments: (0)  Add comment Add Comment
Arrange Comments Last to First
© Copyright 1978-2018 by Martin Rapaport. All rights reserved. Index®, RapNet®, Rapaport®, PriceGrid™, Diamonds.Net™, and JNS®; are TradeMarks of Martin Rapaport.
While the information presented is from sources we believe reliable, we do not guarantee the accuracy or validity of any information presented by Rapaport or the views expressed by users of our internet service.