Mayor’s Jewelers, Sunrise, Fla., closed on a deal Tuesday to turn over controlling interest of the jewelry chain to Henry Birks & Sons of Montreal for $15 million.
Birks provided Mayor’s with $10 million and a note for the remaining $5 million, due on Sept. 30. In return, Birks received stock that gives Birks a 72% interest in Mayor’s. Birks also may receive warrants that could push its stake to 82%.
In connection with the transfer of control, Mayor’s CEO Joe Cicio, Chairman Peter Offerman and four other Mayor’s board members resigned.
Birks appointed Thomas A. Andruskevich, Birks’ CEO and president, to serve as Mayor’s chairman. In addition, Lorenzo Rossi di Montelera, Filippo Recami, and Elizabeth Eveillard were appointed to Mayor’s Board of Directors. John Ball, vice president, chief financial & administrative officer of Birks, was named acting CFO, while Marc Weinstein, senior vice president and COO of Mayor’s, will continue to be in charge of the Mayor’s daily operations.
“We have been excited about this transaction for some time and we are thrilled to have closed the deal. On the one hand, this investment enables Birks to pursue its growth strategy to expand its operations south of the border,” Andruskevich says. “On the other hand, it is key to Mayor’s operational and financial restructuring and represents the culmination of an effort begun over six months ago.”
A key element in the implementation of Mayor’s ongoing restructuring plan was the execution of lease termination agreements with certain of the retailer’s landlords. Also in connection with the transaction, Mayor’s closed on a new senior credit facility from GMAC.