Jewelry giant Signet announced Wednesday that it is buying its smaller cousin the Zale Corporation for about $690 million, in a merger that would bring together the two largest jewelers in the Unites States.
Signet is offering $21 in cash for each Zale share, a 41% premium over Tuesday’s closing stock price. The companies said the deal’s enterprise value, which generally includes debt, is about $1.4 billion, reports the New York Times.
Zale, which sells jewelry under its Zales and Gordon’s brands, has been struggling for years, losing hundreds of millions of dollars in the last three years and many of its customers to Signet subsidiary Kay. Signet, on the other hand, is flush with cash and owns its own credit card business.
Bermuda-based Signet operates 1,400 stores in the United States, while Zale operates about 1,000 Zales stores in the United States, Canada and Puerto Rico.