Tourneau to Be Sold for $300 Million

Tourneau Inc., the leading U.S. watch retailer and one of the world’s largest, announced Sept. 6 that it had “a definitive agreement” to be acquired by an investor group led by Green Equity Investors IV L.P. The group, an affiliate of Leonard Green & Partners L.P., a major private equity firm in Los Angeles, includes members of the Wexler family (owners of Tourneau since 1975) and of Tourneau’s senior management.

The transaction is worth “in excess of $300 million,” says Tourneau, and was expected to close in October.

The New York City company operates 40 stores in the United States and Caribbean under the Tourneau and Watch Gear names, plus two in China. Tourneau is forecasting net sales topping $300 million for the fiscal year ending Jan. 31, 2007.

Under the agreement, Robert J. Wexler, who was Tourneau’s chief executive officer, becomes chairman of the board. Howard R. Levitt continues as president and takes over as CEO. The senior management team remains intact, says the company.

The transaction, said Wexler, “allows the Wexler family to retain significant ownership and continue our active role in the business we’ve owned since 1975.”

The sale comes in the midst of strategic domestic and international expansion of Tourneau this year. It recently opened its 33rd retail store at the Pier at Caesars Atlantic City, N.J., its sixth new U.S. store this year. (As of Sept. 6, Tourneau had 33 stores in the United States and the Caribbean. It also operates seven Watch Gear stores in U.S. malls.)

In April, Tourneau announced a retail partnership with the Swatch Group, the world’s largest watchmaker, to open watch stores in U.S. premium outlet malls. In addition, this year it opened two stores in Shanghai (through a joint venture with the Peace Mark Group), the first of 30 in China over the next five years.

Tourneau, established in 1900, distributes and retails more than 100 well-known watch brands, plus its own Tourneau brand. Its flagship Tourneau TimeMachine in New York is cited by Guinness World Records as the world’s largest watch store.

Leonard Green & Partners manages about $3.7 billion of private equity capital. Its portfolio of companies include the Neiman Marcus Group, The Sports Authority, FTD Group, and Rite Aid Corp.