Silverfleet Capital

Histoire d’Or

Business overview

Histoire d’Or is France’s leading jewellery chain, retailing gold, silver and costume jewellery (including watches) via a network of over 200 stores. The majority of stores are located in shopping centres throughout France with a small number located in city centres. Histoire d’Or also has a presence in Italy, Belgium and Portugal.

Investment rationale

Prior to Silverfleet Capital’s investment, Histoire d’Or was operating 124 stores, a number which it had been steadily growing over the years. We were convinced that there was an opportunity to accelerate the roll-out of an already proven store concept, and in March 2006 we backed the existing management team, led by Eric Belmonte, in a tertiary buy-out.

The roll-out was aimed principally at locations in French shopping centres; both through organic growth as well as by purchasing existing stores owned by independent operators. We had also identified several potential acquisitions both in France and abroad; when we invested, in March 2006, the business was still an almost exclusively French one but there was potential scope to replicate its success in targeted neighbouring European markets.

Value creation

Soon after completing the acquisition of Histoire d’Or we set out to accelerate the store roll-out and, by the end of 2007, a total of 44 stores were added in France, 17 of which were a result of the acquisition of the Charles d’Orville chain. From this point, we continued to open an average of 7 stores a year in France, with a temporary pause for much of 2009 because of the economic slowdown.

In October 2007 Histoire d’Or bought its Belgian franchisee, adding a further eight outlets, to which it added another two stores in that market. After careful analysis we became convinced that there was an opportunity for Histoire d’Or in the Italian market, which bore some resemblance to the French marketplace, albeit more fragmented. A first store was opened in Naples in September 2007 and by September 2010, when we agreed to sell the business, there were 11 locations in Italy.

At the time of our successful exit in October 2010 Histoire d’Or had 208 stores, and had demonstrated that the existing store concept was working not only in France but also in Belgium and in Italy.

Outcome

In the spring of 2010 we received an approach from an investor group and after lengthy negotiations we concluded that the terms arrived at were unlikely to be exceeded in a competitive auction, and we therefore decided to exit. In October 2010 the business was sold for €417million resulting in a return of 3x cost and a 27% IRR.