Two private equity firms consider joint bid for Signet; Ratner interested in H Samuel chain

Apax Partners Worldwide LLP and Kohlberg Kravis Roberts & Co. said they are considering a joint bid for Signet Group Plc, according to media reports.

Bloomberg News reports that the buyout firms jointly undertook a “preliminary analysis” of Signet, the world’s largest specialty jewelry retailer, that included “the consideration of a possible offer,” Apax said Thursday in a statement. Goldman Sachs Group Inc. is advising the private equity companies, according to a report in London’s City AM newspaper.

Signet, reportedly said they are aware of the interest but have not been formally approached.

The statement from Apex reportedly said: “No decision as to whether or not to progress with an offer has been made and, as a consequence, there can be no assurance that any offer for the company will be made.”

A deal for Signet, which operates 1,847 specialty retail jewelry stores in the U.S. and the U.K. could reach $4.4 billion, according to the British publication, The Independent.

Shares of Signet jumped 15 percent Thursday on the news.

In addition to the joint-buyout possibility, Gerald Ratner, former chief executive of the Ratners jewelry chain which was renamed Signet Group PLC, has appointed accountancy firm BDO Stoy Hayward to work on a possible bid for Signet’s U.K. chain H Samuel, another British publication, The Daily Telegraph reported.

Ratner, who lost control of his eponymous company after calling one of his products ‘total crap’, said BDO had contacted Signet’s management on his behalf about a possible deal, according to the article.

Ratner told The Independent that he believes a buyer may want to split off the chain, and he criticized Signet’s management of H Samuel.

“I just think that H. Samuel is a mess. It’s got the wrong product at the wrong price, and with the wrong displays,” he told the newspaper. “We certainly would be very interested in buying it. Its got the most marvelous locations, marvelous staff, and a marvelous name.”

Signet, which Thursday reported a 10.5 percent increase in second-quarter sales on growth in the U.S., in June ended talks about a possible merger with U.S. competitor Zale Corp. The retailer said it plans to spend $1 billion over five years expanding in the U.S. to offset a slump in the U.K.

Signet operates 1,257 stores in the U.S., where the it trades as “Kay Jewelers,” “Jared The Galleria Of Jewelry,” and under a number of regional names; and 590 stores in the UK, where it trades as “H Samuel,” “Ernest Jones,” and “Leslie Davis.”