An earlier courtship fell apart, but as of Thursday, Signet Jewelers Ltd. and Zale Corp. of Texas are fully wedded.
The majority of Zale’s shareholders approved the sale of the company to rival Signet, whose U.S. division, Sterling Jewelers, is headquartered on Ghent Road in Akron.
The deal is valued at $1.46 billion, including assumed debt. As part of the acquisition, Signet is paying $21 per share for the smaller Zale, or about $690 million.
The combined companies become an industry powerhouse, with more than 3,600 locations. Signet now has a presence in Canada, where Zale operates the Peoples Jewellers chain.
Signet (NYSE: SIG) already was a mall retail giant and the largest operator of jewelry stores in the United States and the United Kingdom.
Sterling operates more than 1,400 jewelry stores across the country, primarily under the Kay Jewelry and Jared The Galleria of Jewelry names. The division’s U.S. stores generate the vast majority of sales for Signet.
Thursday’s merger came roughly eight years after talks about a Signet takeover of Zale were terminated.
Signet gave no reason at the time for the halt. But Zale officials said then, in June 2006, that they decided shareholders would be better served if the company remained independent.
A second courtship began last year. Signet CEO Michael Barnes told the Beacon Journal earlier this year that he and others at Signet reached out to Zale about combining the companies.
Barnes joined the company in 2010. He previously was president and chief operating officer of watch and handbag maker Fossil Inc.
About three months ago, Sterling made its offer. Barnes told the Beacon Journal at the time: “We saw an opportunity here. Zale is a great company with a fantastic heritage, just like Kay has a wonderful brand heritage ... offering really complementary brands to what we have.”
He noted that while Zale had gone through “some pretty tough times in the recession and the years following,” Zale Chief Executive Theo Killion had led a turnaround.
Signet said Thursday that Zale will operate as a separate division led by Killion as president and CEO. The company will continue to be headquartered in Irving, Texas.
Also Thursday, Signet revealed various organization changes, including the promotion of Mark Light to the new position of president and chief operating officer of Signet Jewelers Ltd. He will retain the title of president and CEO of Sterling Jewelers — Signet’s pre-acquisition U.S. business — and will continue to report to Barnes.
George Murray has become Signet’s chief integration management officer, working with employees to integrate Zale into Signet.
Steve Becker, previously senior vice president of human resources for Sterling, is now chief human resource officer for Signet Jewelers Ltd.
Signet said it also has begun an executive search to fill two “important Signet leadership positions that will both report to Mr. Barnes”: chief marketing and strategy officer and chief information officer.
Hedge fund TIG Advisors — a large Zale investor — and proxy adviser Glass, Lewis & Co. had criticized Signet’s purchase offer and wanted Zale shareholders to vote against it. Investor Mario Gabelli, who has a large stake in Myers Industries of Akron and Diebold of Green, also opposed the deal.
Shareholders apparently liked the merger. Shares closed up $3.70 to a 52-week high of $108.37. The stock’s 52 week low was $65.14 on June 24.
Katie Byard can be reached at 330-996-3781 or email@example.com.