The news has just broken that the Swatch Group has agreed to buy the watch and jewellery operations of Harry Winston for US$750 million, and will assume up to US$250 million of debt.  This only covers the watch and jewellery retail business, which includes 535 employees worldwide and the Harry Winston manufacturing facility in Geneva.  The sale does not include the mining division of the Toronto-based Harry Winston Diamond Corp, which will be renamed Dominion Diamond Corp after the sale. Dominion will then become a pure play mining concern and should eliminate some of the conglomerate discount on its shares. This is the first purchase by the Swatch Group in nearly 10 years and Harry Winston fills a hole in the Swatch Group’s portofolio. Now Swatch has a storied, high-end jewellery brand; Richemont has Cartier and Van Cleef & Arpels while LVMH has Bulgari.  Swatch has more experience running a luxury retailer than its former parent, which should help unlock some of the jeweller’s potential. But importantly, how the Swatch Group will continue or maintain Harry Winston’s Opus series and cooperation with independent watchmakers will be interesting. – SJX