It’s the largest watch retailer in the United States, but Tourneau was struggling, some 12 years after being taken over by private equity firm Leonard Green & Partners for over US$300m, weighed down by debt taken on during the takeover and a subsequent fund raising.
Now it’s been rescued by Bucherer, Europe’s biggest watch retailer that’s been riding high on years of spending by Chinese tourists. Still owned by the founding family, Bucherer’s annual revenue tops SFr1 billion – making it the biggest chain outside China and Hong Kong. All of that turnover comes from Europe, where it has 33 Bucherer stores and as many more jewellery and single-brand boutiques. Notably, Bucherer is reputedly the largest seller of Rolex watches in the world.
Last year the Swiss retailer took over The Watch Gallery, converting its six London shops and department store concessions to the Bucherer name, to grow its footprint in the United Kingdom. With that acquisition Bucherer was buying into strength, with the London chain’s sales growing in high double digits in recent years, buoyed by the same tide of a weak pound and rising tourist numbers that is lifting retailers in the British capital.
In contrast, Bucherer is buying Tourneau at a low. The American retailer started the sale process in late 2016, seeking out buyers as far away as Asia. Last year it even considered selling itself in a pre-packaged bankruptcy, according to the New York Post. Along the way, the chain closed five locations, bringing its total number of stores to 28 in ten states. Besides the 28 shops, Bucherer also gets Tourneau’s “Certified Pre-Owned” programme, one of the biggest run by an authorised retailer in the country.
The Swiss acquirer has nevertheless got its timing right. When Tourneau started the sale process the global watch business was still flagging, until a recovery that took place last year. Listed watchmaking groups like Richemont and Swatch have already reported turnarounds in sales and profits, while expecting things to get only better.
The terms of the deal were not disclosed, neither has Bucherer announced if it will keep the Tourneau brand name.
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