Jewellery retailer Bailey Banks & Biddle sold for $200 million

Philadelphia-based jewellery retail chain Bailey Banks & Biddle, founded in 1832, is being sold for $200 million to Finlay Enterprises Inc, a retailer that is looking to grow its luxury jewellery business. The sale is expected to close at the end of October.

With a chain of 70 stores in 24 states, Bailey Banks & Biddle has been owned since 1962 by Texas retailer Zale Corporation. Zale has said that it wants to concentrate on its more profitable divisions. Bailey Banks & Biddle was founded in the 19th century in Philadelphia. Zale bought the chain in 1962, when it had just two stores. It grew to 70 stores and a national presence.

"The sale is consistent with our strategy to focus on our core moderate jewellery business and to improve our returns on capital," Zale vice president and treasurer David Sternblitz said. He admitted that Bailey Banks & Biddle stores are beautiful and have a tremendous tradition, but the business is less synergistic with the remainder of the corporation.

Chief executive officer and chairman of Finlay Arthur E Reiner said Bailey Banks & Biddle would fit right in at his company, as it sought to expand its market share in the booming luxury market. New York-based Finlay operates specialty luxury jewellery stores and fine jewellery counters in department stores.

He said the deal would give Finlay a larger national presence and diversify its revenue streams. It could generate upward of $280 million to $300 million of new revenue for Finlay in fiscal 2008.

Reiner said the Bailey Banks & Biddle brand would complement Finlay''s Carlyle and Congress brands and give the company a larger representation in the Philadelphia area. Finlay owns 33 Carlyle stores, mainly in the New York, New Jersey and Philadelphia areas.