Gitanjali's Buying Spree

Warren Buffett isn’t the only one buying up jewelry companies. Gitanjali’s purchase of Rogers Jewelers, for some $18 million, is part of a much larger plan.

I spoke with Nehal Modi, CEO of Gitanjali USA, and here is what he told me …

- Samuels, which has been buying up a lot of one- and two-store operations and converting them to the Samuels name, now has 110 stores. With the Rogers acquisition (46 stores), Gitanjali now has about 160 stores. It wants 175 by the first half of next year, and 400 stores by 2009. 

To that end, it plans "two major [retail] acquisitions” in the next 18 months.

-  While Samuels and Rogers will function as standalone brands, “management headquarters will be amalgamated” by the end of next year. “We don’t know yet which one will take over … until we can assess the management and business practices [of each],” Modi says.

- Samuels and Rogers are different kinds of operations; one mass-merchant, the other upscale. “We hope that 65 – 75% [of our business] will come from the Rogers-type customer,” Modi says. “We [are targeting] less the mass market customer, and more the niche consumer that we believe Zale and Sterling are neglecting. We believe that customer, regardless of economic downturn, will always have money.”

- The company is also close to “finalizing a wholesale acquisition,” which will fit under the Gitanjali umbrella.

- Eventually, Gitanjali wants to supply about 50% of Samuels’ and Rogers’ product.

- He adds the company’s objective, in the next three to four years, is to initiate “powerful brands” on the wholesale level. “Now that we have our own store presence we can use them as a proving ground, he says.

Rather ambitious. It certainly bears watching. And as this article notes, the company hopes to do something similar in China.