What to like about the Signet-Zale merger

|About: Signet Jewelers Limited (SIG)|By:, SA News Editor

The merger between Signet (SIG +18.5%) and Zale (ZLC +40.2%) gives the combined company extra clout when sourcing its products, according to Citigroup.

The investment firm also likes the ability of brands to be cross-sold in new channels and for the jewelry sellers to strike synergies in key areas.

A rationale reduction of Zale's store count will create even more upside.

The clash of cultures shouldn't be too great with execs swapping back and forth between Zale and Signet over the years. Zale’s non-executive chairman, Terry Burman, is former Signet CEO.