"By owning this state-of-the-art facility, its first, Signet can ensure more consistent, cost-effective access to diamonds in the sizes and qualities it needs," said Signet Jewelers spokesman David Bouffard.
AKRON, Ohio -- Signet Jewelers Ltd., the parent company of Kay Jewelers and Jared the Galleria of Jewelry, has bought a diamond polishing factory in Gaborone, Botswana, as part of its efforts to ensure a more reliable long-term source of diamonds for its jewelry stores.
The facility, acquired for an undisclosed sum from H&A Cutting Works Ltd., a subsidiary of Exelco International Limited in the United Kingdom, is Signet's first diamond factory. But the company suggested it may not be its last.
"Signet's objectives with this initiative are to secure additional, reliable and consistent supplies of diamonds for our customers, and achieve further efficiencies in the supply chain," said Signet Chief Executive Mike Barnes, in a statement.
"We are committed to further developing this initiative, as well as building our relationships with our established vendors of polished diamonds and diamond jewelry, who will continue to account for the majority of our diamond sourcing."
Signet, the largest specialty jewelry retailer in the U.S. and the U.K. with more than 1,900 stores, is also among the most successful creators and promoters of diamond brands in those countries.
More than 75 percent of Signet's U.S. sales come from diamonds or diamond jewelry, the company said. The United States is the world's largest diamond market, and Signet's U.S. retail division is based in Akron.
"Botswana is the number one diamond producing country in the world, in terms of value," said Signet spokesman David Bouffard, via email. "Signet's financial strength has allowed it to acquire this diamond-polishing facility in Botswana, the new heart of the diamond world, as DeBeers (Diamond Jewellers) has recently moved its sales office there, for example."
"By owning this state-of-the-art facility, its first, Signet can ensure more consistent, cost-effective access to diamonds in the sizes and qualities it needs with less vulnerability to the fluctuations of the overall diamond market."
Signet said that it wants to "significantly" increase its rough-diamond sourcing and manufacturing capacity through its wholly-owned subsidiary, Signet Direct Diamond Sourcing Limited, and that acquiring and operating this factory in Botswana is a key part of that strategy.
In late September, the International Diamond Exchange reported that Alrosa, the Russian diamond mining company and the world's largest diamond producer by carats, was "close to signing a three-year supply contract" with Signet Jewelers for $80 million worth of diamonds.
Bouffard said at the time that Signet does not comment on industry speculation.
"We're excited that there are now more than 230 new Signet team members in Gaborone, Botswana, and it is anticipated that there may be a small number of new positions in Signet's Home Office in Akron, over time, as a result of the acquisition," he said Thursday.