National Jeweler Network

Market Developments

Sterling buying Ultra Stores chain for $57M

2012-10-24

Editor's note: This story has been updated to include an additional comment from a Signet spokesperson, as well as information on Ultra Diamonds' current store count.

Hamilton, Bermuda--Signet Jewelers Ltd. announced early Wednesday that it is buying Ultra Stores Inc., operator of the Ultra Diamonds outlet stores as well as the jewelry departments in a number of off-price department stores, for $57 million in cash.

Signet Jewelers, parent company of the U.S.’s largest specialty jeweler Sterling Jewelers Inc., is purchasing Ultra Stores from Boston-based Crystal Financial LLC and its stockholders. Crystal is a commercial finance company that originates, underwrites and manages secured debt. 

Signet said it will not assume any debt in connection with the transaction.

When asked if the Ultra Diamonds stores would be re-named to reflect a Signet brand, a company spokesman said, "As we enter the all-important holiday season, and then on into the Valentine’s and Mother’s Day periods, we will be focused on closely collaborating with the Ultra team to build a winning combination of two great market leaders. We will be very careful in the execution and timing of integrating the two businesses. As the transaction has not yet closed, we do not believe it is appropriate at this time to provide additional information beyond what is in our press release, but rather will update ... at the appropriate time post-closing."

According to National Jeweler’s 2012 list of $100 Million Supersellers, Ultra Stores was tied with T.J. Maxx at No. 30 with $145 million in watch and jewelry sales in 2011. Its sales were down 7 percent from 2010.

By store count, Ultra ranked as the fifth-largest jeweler in North America in 2011, with a total of 150 locations: 121 outlet stores and 29 licensed jewelry departments, with plans to open 10 to 12 stores in 2012, according to the 2012 State of the Majors. UltraDiamonds.com currently states that the chain has more than 140 stores nationwide.

“The addition of Ultra will immediately result in our having a significant share of the outlet channel for jewelry,” said Signet CEO Michael Barnes. “We had identified this rapidly growing channel as an opportunity to profitably increase our sales, enabling us to leverage our competitive strengths and add Ultra’s expertise to our team. We believe that the resulting synergies will create a terrific win for our customers and investors.”

Founded in 1991, Ultra Stores filed for “pre-packaged” Chapter 11 bankruptcy protection back in April 2009 and emerged relatively quickly, in July 2009.

Ultra President and CEO Daniel Marks said the company is looking forward to becoming a part of Signet, combining its outlet expertise with the market leader among specialty jewelers.

Signet ranks No. 1 on National Jeweler’s 2012 list of $100 Million Supersellers, with $3.03 billion in watch and jewelry sales in 2011.