Tourneau sponsor engages investment banker to sell luxury watchmaker
22 December, 2016
Tourneau’s sponsor Leonard Green & Partners engaged Houlihan Lokey to sell the luxury watchmaker, said two sources close to the situation.
The sales process, which has been ongoing for three months, has so far failed to gain traction in light of the decline of the watch exports industry, the two sources said.
The company’s EBITDA was in the mid-USD 20m range, said one of those sources and a third source familiar with the situation.
Leonard Green acquired Tourneau for USD 355m in 2006 for roughly 12.8x EBITDA, of which it funded USD 130m of the deal price with debt. Later GE Capital, now Antares Capital, funded a USD 150m revolver for Tourneau in 2011, according to a company press release.
Leonard Green, Tourneau and Houlihan did not provide a comment.
The advent and affordability of the cellphones have without a doubt eaten into the market share of global timepieces. The value of watch exports was about CHF 1.9bn (USD 1.85bn), which is down by 5.6% for November of FY16, according to a Swiss Watchmaking report for November 2016.
The top three markets for the Swiss watch industry is Hong Kong, the US and China. Watches sales in the US recorded one of its worst results of the year after March noting that it narrowed by 18.06%. On the other hand, there remains a glimmer of hope in the West with watch sales in Hong Kong stabilizing yet at a loss of 0.7%, and China having risen by 7.9%, as per the same report.
Tourneau was established in 1900 in Western Europe, according to the company’s website. In 1925 Peter Tourneau opened a watch counter at the Berkshire Place Hotel in New York. It currently has 31 locations, with flagship stores in New York City and Las Vegas, and it distributes more than 100 men’s and women’s watch brands including Rolex, Patek Philippe, Cartier, Breitling and Tag Heuer. The company also sells certified pre-owned timepieces and watches under the Tourneau brand name, according to the company.