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According to a statement released by Signet, Blue Nile has been purchased in a $US360 million deal as a strategic acquisition that will boost Signet’s attempts at expanding its bridal product portfolio.

Signet CEO Virginia C. Drosos said Blue Nile was a unique business with a rich history.

“Blue Nile is a pioneer and innovator in online engagement rings and fine jewelry, providing a unique and highly desirable shopping experience for customers,” she said.

“Adding Blue Nile to our strong and diversified portfolio of banners will further drive our Inspiring Brilliance growth strategy – expanding customer choice, building new capabilities, and achieving meaningful operating synergies that will increase value for both our consumers and shareholders.”

Blue Nile was founded in 1999 by Mark Vadon and today is based in Seattle. The business was formed in a bid to capitalize on the rise of online shopping and within 10 years, was one of the largest diamond and diamond engagement ring retailers in the US.

Blue Nile was acquired in 2017 by an investor group comprised of Bain Capital Private Equity, Bow Street, and Adama for approximately $US520 million.

In June of this year, Blue Nile CEO Sean Kell announced that Blue Nile would combine with New York special purpose acquisition company Mudrick, as well as become a publicly-traded company on the US NASDAQ in a bid to secure further investors.

Blue Nile’s Kell said that in the years to come the brand would continue to expand under the Signet umbrella.

“We’re equally thrilled to join a purpose-inspired and sustainability-focused company that shares our core values,” he said.

“By joining Signet, we will extend our premium brand and fine jewelry offering to millions of new customers while bringing new capabilities to our leading e-commerce business that will drive additional growth opportunities for Blue Nile.”

Signet owns more than 2,800 stores including Kay Jewelers, Zales, Jared, Diamonds Direct, JamesAllen.com, Rocksbox, Peoples Jewellers, H.Samuel, Ernest Jones, and Sterling Jewelers.

Signet’s business interests primarily focus on the US market, with just $US492.4 million in revenue generated internationally last financial year. In comparison, it reported more than $US7 billion in sales in North America.

The completion of the transaction is expected to occur in the third fiscal quarter, which ends in October. Both companies have the option of withdrawing from the deal if no closure is reached by 3 November.

Revised guidance

Signet is updating its guidance for the second quarter and full year given “given heightened pressure on consumers’ discretionary spending and increased macroeconomic headwinds.”

According to a statement from the company, second quarter total revenue is expected to reach approximately $US1.75 billion. Signet expects total revenues for the year to be in the range of $US7.6 to $US7.7 billion. This is a reduction from an early estimate of $US8.03 to $US8.25 billion.

Signet CEO Drosos said inflation as a major concern for consumers.

“We saw sales soften in July as our customers have been increasingly impacted by rapid inflation, so we’re revising guidance to align with these trends,” she said.

“That said, I’m pleased that revised guidance positions us up 25 per cent in revenue versus the [FY20] pre-pandemic period.

“In addition, our transformed operating model and strong balance sheet give us dry powder, even in a down market, to invest in market share expansion as we are doing organically in our banners and with the acquisition of Blue Nile.”

Drosos echoed Kell’s sentiment on the importance of shared values ​​between Signet and Blue Nile.

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