$625 Million Convertible Preferred Investment by Leonard Green &
Partners
Signet to Repurchase up to $625 Million in Common Stock
Signet will appoint Jonathan Sokoloff, Managing Partner of Leonard
Green & Partners, to the Board of Directors
HAMILTON, Bermuda--(BUSINESS WIRE)--
Signet Jewelers Limited (NYSE:SIG), the world's largest retailer of
diamond jewelry, announced today that affiliates of Leonard Green &
Partners, L.P. (“LGP”), a leading private equity firm, will invest $625
million in the form of convertible preferred shares. Signet will use the
proceeds from the LGP investment to fund a repurchase of up to $625mm in
common stock either in the open market or through privately negotiated
transactions. In conjunction with this transaction, Signet will expand
its Board of Directors from ten to eleven and appoint Jonathan Sokoloff
to the Signet Board upon the closing of the transaction, which is
expected to occur in the third quarter of FY 2017.
Mark Light, Chief Executive Officer of Signet Jewelers, said, “We are
very pleased to announce this strategic partnership with Leonard Green,
one of the most experienced and successful investors in the retail
industry. For more than 25 years, Leonard Green has successfully
partnered with some of the best known companies in the retail sector and
worked to create significant shareholder value. We view Leonard Green’s
significant investment in Signet as a strong vote of confidence in our
business and its long term growth prospects.”
Todd Stitzer, Chairman of Signet Jewelers, said, “We found in Leonard
Green a long term partner who will provide a strong foundation to our
shareholder base and will bring additional retail and financial
expertise to our Board of Directors to help us further grow and shape
the Signet portfolio of brands in a continuously evolving retail
landscape.”
Jonathan Sokoloff added, “Signet Jewelers is an outstanding company – an
innovator in its industry with some of the world’s most recognizable
store banners and jewelry brands. We are pleased to make this investment
and look forward to our partnership with the Board and management team.”
The investment by Green Equity Investors VI, L.P., an affiliate of LGP,
in Signet will include the following terms:
-
$625mm in convertible preference shares
-
The convertible preference shares accrue a 5% p.a. dividend, payable
quarterly in arrears, in cash or by increasing the liquidation
preference, at the option of Signet
-
The preference shares will be convertible into Signet common shares at
a premium of 18% to the volume weighted average price of the common
shares for the 20 trading days immediately following Signet’s second
quarter earnings announcement on August 25, 2016, with a maximum
conversion price of $100 per share
-
LGP will be subject to a two year lock-up period and Signet will also
have the right to force conversion after two years subject to Signet’s
common shares achieving a specific price threshold
As a part of the transaction, Signet is increasing its Board authorized
share repurchase program by $625 million, bringing the total
authorization to $1.1 billion when combined with the $511 million
remaining under the previously authorized repurchase program. The
transaction is expected to close in the third quarter of FY 2017,
subject to the receipt of customary regulatory approvals. Additional
information regarding the investment will be included in a Form 8-K to
be filed today by Signet with the Securities and Exchange Commission.
J.P. Morgan Securities LLC acted as financial advisor and Weil, Gotshal
& Manges LLP acted as legal advisor to Signet. Guggenheim Securities
acted as financial advisor and Latham & Watkins LLP acted as legal
advisor to Leonard Green & Partners, L.P.
About Signet
Signet Jewelers Limited is the world's largest retailer of diamond
jewelry. Signet operates approximately 3,600 stores primarily under the
name brands of Kay Jewelers, Zales, Jared The Galleria Of Jewelry,
H.Samuel, Ernest Jones, Peoples and Piercing Pagoda. Further information
on Signet is available at www.signetjewelers.com.
See also www.kay.com,
www.zales.com,
www.jared.com,
www.hsamuel.co.uk,
www.ernestjones.co.uk,
www.peoplesjewellers.com
and www.pagoda.com.
About Leonard Green & Partners
Leonard Green & Partners, L.P. is a leading private equity investment
firm founded in 1989. Based in Los Angeles, the firm partners with
experienced management teams to invest in market-leading companies.
Since inception, LGP has invested in over 80 companies in the form of
traditional buyouts, going-private transactions, recapitalizations,
growth equity, and selective public equity and debt positions. The
firm’s primary sectors of focus are consumer/retail,
healthcare/wellness, business/consumer services, and distribution.
Select past and current investments include Whole Foods Market, Life
Time Fitness, Shake Shack, Activision, Jetro Cash & Carry, CHG
Healthcare, and Petco. For more information, please visit www.leonardgreen.com.
Safe Harbor Statement
This release contains statements which are forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of
1995. These statements, based upon management’s beliefs and expectations
as well as on assumptions made by and data currently available to
management, appear in a number of places throughout this document and
include statements regarding, among other things, Signet’s results of
operation, financial condition, liquidity, prospects, growth, strategies
and the industry in which Signet operates. The use of the words
“expects,” “intends,” “anticipates,” “estimates,” “predicts,”
“believes,” “should,” “potential,” “may,” “forecast,” “objective,”
“plan,” or “target,” and other similar expressions are intended to
identify forward-looking statements. These forward-looking statements
are not guarantees of future performance and are subject to a number of
risks and uncertainties, including but not limited to general economic
conditions, a decline in consumer spending, the merchandising, pricing
and inventory policies followed by Signet, the reputation of Signet and
its brands, the level of competition in the jewelry sector, the cost and
availability of diamonds, gold and other precious metals, regulations
relating to customer credit, seasonality of Signet’s business, financial
market risks, deterioration in customers’ financial condition, exchange
rate fluctuations, changes in Signet's credit rating, changes in
consumer attitudes regarding jewelry, management of social, ethical and
environmental risks, security breaches and other disruptions to Signet’s
information technology infrastructure and databases, inadequacy in and
disruptions to internal controls and systems, changes in assumptions
used in making accounting estimates relating to items such as extended
service plans and pensions, risks related to Signet being a Bermuda
corporation, the impact of the acquisition of Zale Corporation on
relationships, including with employees, suppliers, customers and
competitors, and our ability to successfully integrate Zale
Corporation's operations and to realize synergies from the transaction.
For a discussion of these risks and other risks and uncertainties which
could cause actual results to differ materially from those expressed in
any forward looking statement, see the "Risk Factors" section of
Signet's Fiscal 2016 Annual Report on Form 10-K filed with the SEC on
March 24, 2016. Signet undertakes no obligation to update or revise any
forward-looking statements to reflect subsequent events or
circumstances, except as required by law.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160825005308/en/
Source: Signet Jewelers Limited