Seeking Alpha

Signet and Zale to merge in sector-rattling combination

  • Signet (SIG) confirms its acquisition of Zale (ZLC) in a transaction valued at close to $1.4B. Large Zale stakeholder Golden Gate Capital is on board with the deal.
  • The company expects to finance the transaction through bank debt and a securitization of its accounts receivable portfolio.
  • The merger is expected to be accretive in the first year at a high single-digit percentage.
  • What to watch: Zale's international business and strong online business strengthen a couple of areas Signet had room to improve. The combined company will also yield some improved pricing power.
  • Premarket action: ZLC +40.8% to $20.99 and SIG +11.0% to $88.
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Comments (1)
  • mister-ugly
    , contributor
    Comments (248) | Send Message
     
    CNBC reports possible leak of acquisition at 1 pm today. Look for SEC investigation. Amazing how options and volume tell story leading a direct route. Plenty of "Kiss's" with these diamonds.
    19 Feb 2014, 01:01 PM Reply Like
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