Pandora has entered into an agreement to acquire City Time S.L. (City Time), which owns the distribution rights to company’s jewellery in Spain, Gibraltar and Andorra.
The acquisition follows the takeover of the distribution in Belgium and South Africa earlier in the year, and is consistent with Pandora’s strategic intent to increase control of the brand and strengthen the owned and operated retail footprint.
“By taking over the distribution of Pandora jewellery in Spain, we get direct access to one of the larger jewellery markets in Europe,” explains Pandora chief executive officer, Anders Colding Friis. “Our Spanish partner has done a tremendous job in establishing a strong store network in the country. The acquisition is in line with our strategic intent to take over distribution and enables us to gain full control of the network in Spain and realize the full potential of our brand in this promising market.”
PANDORA will pay the owners of City Time a total amount of around EUR 110 million (£99m) for 100% of the share capital in City Time. The multiple paid (EV/EBITDA) is in line with the price paid related to Pandora’s earlier distributor acquisitions.
With the acquisition, Pandora will gain full control of the distribution rights to Pandora jewellery in Spain, Gibraltar and Andorra, as well as a fully operational set-up in Spain, including a regional office and distribution centre in Madrid and around 500 employees. The agreement is subject to certain conditions to be fulfilled. The transaction is expected to be finalised during Q4 2017.
Looking ahead, the brandwill add to its retail chain 51 Pandora-owned concept stores located in Spain. Furthermore, Pandora will take over distribution of 15 franchisee concept stores and around 500 other points of sales in Spain, Gibraltar and Andorra.
In 2016, City Time’s revenue, consisting of retail sales in the acquired Pandora stores and sell-in to the existing wholesale network in the region, was approximately EUR 94 million in total (£84m).