American watchmaker Movado has dipped into its war-chest to seal a £60m takeover of JLB Brands Ltd, the owner of the Olivia Burton watch brand.
In what marks one of the most notable industry acquisition stories of the year so far, the Movado Group will use the all-cash deal to broaden its fashion watch portfolio and ramp up sales of Olivia Burton timepieces through traditional retail and online channels.
JLB Brands Ltd was founded by Lesa Bennett and Jemma Fennings in 2011 and began selling fashion watches under the Olivia Burton brand in 2012. It added jewellery to its portfolio last year.
Having experienced significant growth in the UK, it has recently expanded its business internationally.
Olivia Burton designs are inspired by both fashion and vintage trends for the millennial consumer at accessible price points, with new watch collections launched every two months.
The brand is sold through leading retailers, including John Lewis, Watchshop, Argento, Selfridges and Beaverbrooks in the UK and recently through Nordstrom in the US, where it is now available in 117 stores. Olivia Burton also operates a concession at Topshop’s flagship location in Oxford Circus, London.
In its latest fiscal year ending March 31, 2017, Olivia Burton’s revenue increased 64% to approximately £15m. It is forecasting sales of £25m for the current financial year. The business employs approximately 33 staff at its Shoreditch head office.
Movado Group said Olivia Burton offers it “significant global growth potential” and plans to ramp up global e-commerce penetration and increases its reach beyond the UK.
Olivia Burton will continue to operate under the leadership of Lesa Bennett and Jemma Fennings, its founders, who will report to Efraim Grinberg, chairman and CEO of Movado Group. He confirmed the firm plans to retain the Olivia Burton team in London.
“I have much admired the spectacular job that Lesa and Jemma have done in building the Olivia Burton brand in the UK over the last few years and more recently with the beginning of its international expansion,” said Grinberg.
“While at accessible price points, they have kept the brand extremely creative, innovative and aspirational. They’ve also been building a very strong e-commerce business in the UK, which we believe has great potential for global expansion. With this acquisition, we not only reaffirm our commitment to the watch category, but also expand our presence into fashion jewellery. Olivia Burton’s success under Lesa and Jemma’s direction prove that beautifully designed watches and jewellery can continue to excite today’s consumer.”
Fennings said the sale of the business would give Olivia Burton the global scale and infrastructure required to support its vision for growth.
“Movado Group shares our passion and relentless focus on innovation and this partnership will further strengthen the design of our watch and jewellery offerings and significantly increase our distribution around the world,” she said.
Her business partner, Lesa Bennett, added: “We are pleased that Olivia Burton will continue to operate with its current management team and employees, allowing the transaction to be seamless to our valued clients and business partners. We believe that Olivia Burton has tremendous opportunity for growth, and we look forward to becoming part of Movado Group to help the brand reach its potential.”
Movado bosses told investors they would discuss the deal and the nature of the transaction in more detail when Movado reports its second quarter fiscal 2018 results.
It confirmed the acquisition was funded with cash on hand from Movado Group’s non-US subsidiaries.