BULGARI ACQUIRES TWO LUXURY WATCH COMPANIES
Byline: Luisa Zargani
MILAN — Bulgari Group announced on Wednesday the purchase of two high-end watch brands — Gerald Genta SA and Daniel Roth SA — for $22.5 million from The Hour Glass, a Singapore-listed group. (The dollar figure is converted from the Swiss franc at the current exchange rate.)
Under the agreement, Bulgari will also own the labels’ production facilities, Manufacture de Haute Horlogerie SA.
“I strongly believe that this acquisition will very much help Bulgari in its process of developing know-how in the complicated watches segment,” said Francesco Trapani, chief executive officer of the Bulgari Group, in a statement issued by the Rome-based luxury jeweler.
Bulgari is among the growing crowd of companies intent on building luxury goods groups. In May, it announced plans for an investment fund, called Opera SA, which would take stakes in medium-size Italian companies. Trapani and his partner in Opera, Renato Preti, said they hoped to raise between $140 and $190 million over the next six months, adding to Bulgari’s initial $23.4 million.
Trapani said the latest acquisition was in line with the company’s strategy of further developing its business in the watch market by allowing Bulgari to blend its own experience in the watch business with the two companies’ know-how, technologies and manufacturing capabilities.
The Hour Glass, specialized in watch distribution in Asia, bought stakes in Daniel Roth in 1994 and in Gerald Genta in 1996, and finally took full control of both last year.
The Hour Glass will be the exclusive distributor of the two brands in the Asian markets, and Bulgari will directly distribute them in the rest of the world. A spokeswoman for Bulgari said the company plans to focus on a highly selective distribution. The two Swiss labels will not be available in Bulgari’s 100 stores. While there are currently 450 sales points in the world that carry Bulgari watches, the Roth and Genta labels, whose prices range from $5,000 to $150,000, will be available in fewer sales points.
Genta and Roth posted sales of over $12 million in the fiscal year ending March 31, 1999.
Bulgari last year posted consolidated sales of $440 million.