New Look Eyewear to Acquire Vogue Optical for $74M
The leading banner of corporate eye care stores in eastern Canada purchases the largest integrated optical retailer in the Maritimes New Look Eyewear Inc. announced that it has entered into definitive agreements to acquire the assets and business of Vogue Optical Inc. of Charlottetown, PEI. Founded in 1979 by Wayne and Doreen Gray, Vogue Optical has grown to become the largest integrated optical retailer in Atlantic Canada, with strong brand recognition in the region. Vogue Optical's retail network comprises 65 stores, including 21 in Nova Scotia, 21 in New Brunswick, 15 in Newfoundland and Labrador, 5 in P.E.I and three in other provinces, as well as a lens processing facility. The revenues of Vogue Optical for the 12-month period ended Aug. 31, 2013 amounted to approximately $40 million. New Look is a leader in the eyecare industry in eastern Canada with a network of 74 corporate stores under the New Look banner, plus two affiliated clinics and a laboratory using state-of-the-art technologies. The purchase price of the assets and business of Vogue Optical is $74 million, subject to normal price adjustments. In connection with this transaction, New Look has entered into various financing arrangements providing for a senior secured debt facility of up to $75 million, with a syndicate of major Canadian banks (comprised of an acquisitioin term facility of up to $65 million and a $10 million revolving facility), and a maximum of $25 million of equity financing. In addition, New Look has entered into an arrangement for a $15 million junior unsecured debt facility with a Québec-based fund which may be used to finance a portion of the acquisition purchase price and thereby reduce the draw on the acquisition term facility referred to above. The acquisition of Vogue Optical is expected to close on or about Dec. 2, 2013 subject to usual closing conditions. Antoine Amiel, vice chairman of New Look, said: "We feel privileged welcoming the Vogue Optical team to our organization. Vogue Optical will operate as a stand-alone business based in Charlottetown. Both groups will continue to grow organically and by acquisition in their respective markets. The combined entity will have revenues exceeding $128 million and a store network in excess of 140 locations, making it the third largest Canadian integrated retail optical company and the eighth largest in North America. We will be the most important player in Québec and the Atlantic provinces." "In line with our expansion strategy, I am proud of the acquisition of the largest Maritimes network: Vogue Optical. Over the last 30 years, the company, founded by the Gray family, acquired an enviable reputation that will help us ensure its growth in eastern Canada," said Martial Gagné, president of New Look. "The strength of the banner is based on high-quality products, dedicated professional customer service, and the permanent 2-for-1 promotion offer. These are the same strategic elements that have also brought success to New Look Eyewear and they ensure a natural affinity between the two groups, who will continue their operations under their respective banners. "This consolidation will strengthen our leadership and our purchasing power within the industry. Our challenge will be to share our experience and create a mutual and dynamic synergy that will facilitate the development of our networks. Our mutual passion for retailing optical products and professional services should also bring a better customer experience within our stores."
