Diamonds Direct, a seven-store chain based in Charlotte, N.C., has been acquired by Blackstone Tactical Opportunities, a division of the Blackstone Group, one of the world’s largest investment and private equity firms.
No price was given.
President and co-owner Itay Berger (pictured) will now become CEO. He retains an ownership stake in the business.
“Blackstone brings so much to the table,” he tells JCK. “They have major resources, particularly in real estate. This will allow us to expand bigger and faster.”
To Berger’s knowledge (and JCK’s), Blackstone has no other investments in the jewelry industry. A spokesperson did not return a request for comment.
“It is very positive news for the industry, that a company like this is interested in our business,” Berger says. “They truly believe in the concept of Diamonds Direct.”
Diamonds Direct was founded in 1995 in Charlotte, N.C., by Israeli diamantaire Alon Arabov, a onetime sightholder. In the last seven years, it’s expanded to Raleigh, N.C.; Birmingham, Ala.; Richmond, Va.; and Austin, Texas. It will soon open new locations in Oklahoma City and Charleston, S.C.
Its strategy generally includes linkups with local sports teams, heavy radio advertising, stocking known designer brands, community involvement, competitive warranties, and an emphasis on customer service.
Asked whether it may expand beyond its base in the South, Berger says, “Nothing is out of the question. We started in the Southeast and recently expanded to Austin, Texas. We have a lot of work to do not just in expanding but in maintaining the existing wonderful establishments we have.”
Last year, Berger told JCK that each store averaged $20 million in annual sales.
Diamonds Direct began looking for a buyer earlier this year, Berger says. “We were looking for the right partner that could help us grow,” he says. “We found exactly that.”
The company has seen its share of behind-the-scenes issues over the years, including a 2012 lawsuit among its founders. In October, Arabov, who is no longer involved, was indicted on a tax-related issue.
In a statement, Jasvinder Khaira, managing director of Blackstone Tactical Opportunities, said, “Providing capital to entrepreneurs is a hallmark of Blackstone’s growth investments, and we look forward to working with the Diamonds Direct team on their continued success and growth.”