Aber Diamond Corporation acquires 100% of world-renowned jeweler, Harry Winston
13 Settembre 2006 - 10:00AM
PR Newswire (US)
TORONTO, Sept. 13 /PRNewswire-FirstCall/ -- ABER DIAMOND
CORPORATION (TSX-ABZ, NASDAQ-ABER), today announced that it has
entered into an agreement to purchase the minority shareholders'
interest in world-renowned jeweler, Harry Winston, for
approximately US$157 million giving it full 100% ownership. The
history of the House of Harry Winston dates back nearly 100 years
and includes some of the most famous diamonds in the world, from
the legendary Hope Diamond, now on permanent display at the Harry
Winston Pavilion at the Smithsonian Institution, to the magnificent
jewels owned by royalty, movie stars and heads of state. Harry
Winston's dimensional and fluid designs, flawless craftsmanship and
unparalleled quality have set the standards for diamond jewelry.
Aber purchased an initial 51% stake in Harry Winston in April 2004
for US$85 million and has since increased its equity interest to
approximately 53%. The original purchase agreement included an
option allowing Aber to purchase the balance of Harry Winston in
2010. "The past two and half years have demonstrated the tangible
benefits of linking the marketing of rough diamonds to a high-end
diamond retailer in the form of improved margins at both ends of
the business," said Mr. Robert Gannicott, Chairman and CEO of Aber.
"This acquisition solidifies our position as the world's premier
publicly traded diamond company." The 100% ownership of Harry
Winston strengthens Aber's strategic position as a diamond company
comprising the two most profitable segments of the diamond pipeline
- mining and retailing. This positioning delivers premium rough
diamond pricing through market insight provided by polished diamond
buying. Aber has been able to leverage its role as a supplier of
rough diamonds to secure a more reliable source of the high-quality
polished diamonds required by Harry Winston to support continued
growth. Since the initial investment, Harry Winston sales have
grown from approximately US$128 million for the full twelve months
of fiscal year 2004 (including two months that were prior to Aber's
acquisition), to US$191 million for fiscal year 2006. In addition,
management has strengthened margins and improved operational
performance, thereby contributing to Aber's net earnings earlier
than planned. "The market for luxury goods, including diamond
jewelry, is one of the fastest growing segments of the consumer
market," said Thomas O'Neill, Aber's President and CEO of Harry
Winston. "We believe that given the recognition of the brand
relative to the size of the store network, there is an opportunity
for significant growth." "Harry Winston is performing even better
than we originally anticipated," commented Robert Gannicott. "The
timing and the terms of the deal allow our shareholders to benefit
earlier from the continued growth of Harry Winston." "We are now
able to expand at a pace consistent with the opportunities of the
marketplace," added Thomas O'Neill. "This enables us to open new
stores at an aggressive pace, as well as refurbish our existing
store network. We plan to strengthen our product development,
increase our manufacturing capabilities, and improve management
efficiencies across the businesses." The transaction values Harry
Winston, on an equity basis, at approximately US$330 million. Aber
will finance the acquisition through a combination of cash
resources and an increase to Aber's existing credit facility
without impacting the existing dividend policy. The acquisition and
the expanded credit facility are expected to close by the end of
September 2006. Aber was advised on this transaction by Rothschild
in both London and Washington. About Aber Aber Diamond Corporation
is a specialist diamond company focusing on the mining and retail
segments of the diamond industry. The Company supplies rough
diamonds to the global market through its 40% ownership in the
Diavik Diamond Mine and prior to this transaction owns
approximately 53% of Harry Winston Inc., the premier retailer of
diamond jewelry. About Harry Winston Founded in 1932, Harry Winston
is one of the world's most prestigious branded diamond jewelers,
providing high-end diamond jewelry and timepieces. Known as "The
King of Diamonds", Harry Winston is one of the World's leading
luxury goods brands. The name is synonymous with the most famous
gemstones and jewelry designs in the world, including the Hope
Diamond, the Jonker Diamond, and the Taylor-Burton Diamond. This
press release contains certain information that may constitute
forward-looking information within the meaning of securities laws.
In some cases, forward-looking information can be identified by the
use of terms such as "may", "will", "should", "expect", "plan",
"anticipate", "believe", "intend", "estimate", "predict",
"potential", "continue" or other similar expressions concerning
matters that are not historical facts. Forward-looking information
may relate to management's future outlook and anticipated events or
results, and may include statements regarding the business strategy
and strategic goals of Aber and Harry Winston. Particularly,
information regarding Harry Winston's plans and objectives,
including its plan to open new stores, refurbish existing stores,
strengthen product development efforts, increase manufacturing
capabilities and improve information systems, as well as
information regarding the expected date of closing of the
acquisition of the balance of Harry Winston and the financing, is
forward-looking information. Forward-looking information is based
on certain factors and assumptions regarding, among other things,
world economic conditions, the demand for and supply of diamonds
and the exchange rate between the US dollar and the Canadian
dollar. While Aber considers these assumptions to be reasonable
based on information currently available to it, they may prove to
be incorrect. Forward-looking information is subject to certain
factors, including risks and uncertainties that could cause actual
results to differ materially from what we currently expect. These
factors include risks relating to disruptions in the world economy,
changes in the demand for or supply of diamonds, and risks relating
to fluctuations in the exchange rate between the US dollar and the
Canadian dollar. You should not place undue importance on
forward-looking information and should not rely upon this
information as of any other date. While Aber may elect to, Aber is
under no obligation and does not undertake to update this
information at any particular time. DATASOURCE: Aber Diamond
Corporation CONTACT: Media and Investor enquiries, please contact:
Philip Koven, Bryan Mills Group: (416) 447-4740 ext. 235
Copyright