Gitanjali Gems Ltd. has acquired a majority ownership interest in Samuels Jewelers Inc. from funds managed by DDJ Capital Management. Terms of the transaction were not disclosed.
Samuels operates 97 retail jewelry stores in 18 states throughout the United States. It operates under three trade names: “Samuels,” “Schubach,” and “Samuels Diamonds.” Measured by the number of retail locations, Samuels is the tenth largest specialty retailer of fine jewelry in the United States. The company will remain headquartered in Austin, Texas, according to a statement released Wednesday.
“This acquisition is consistent with Gitanjali’s objective to conform to a vertically integrated model, one that benefits from all the efficiencies that are realized through control of the entire supply chain, inclusive of retail,” G.K. Nair, Gitanjali chief financial officer said. “To that end, Samuels is an ideal match to complement Gitanjali’s strengths in manufacturing diamonds and jewelry products.”
Gitanjali Gems Ltd., based in Mumbai, India, is a DTC sightholder and is one of the largest integrated diamond and jewelry manufacturers and retailers in India.
“Gitanjali’s 11.5 million square foot Hyderabad Special Economic Zone will provide a tremendous support system for product development and jewelry manufacturing and will offer unparalleled economic benefits to Gitanjali’s customers worldwide, including Samuels, said Mehul Choksi, Gitanjali’s chairman.
Nehal Modi, CEO of Gitanjali’s U.S. affiliated companies, Diamlink and JMC, commented that “the industry is prime for consolidation and we viewed this opportunity with Samuels’ stores and management team as an ideal compliment to our ongoing operations in the U.S. By combining Gitanjali’s extensive industry resources with Samuels’ rich network of retail stores, this transaction represents an exciting and unique endeavor for all those associated with Gitanjali and Samuels.”
Samuels’ President and CEO, Randy McCullough said that, “Samuels is excited to have Gitanjali as a majority shareholder and vendor partner. We look forward to working with Gitanjali and see this transaction as a tremendous opportunity for expanded market share and future growth.”
In connection with the stock purchase transaction, Samuels has obtained a financing facility from Wells Fargo Retail Finance, LLC. Samuels said it anticipates that the $60 million facility will be more than sufficient to meet its cash flow needs for the foreseeable future.