Watches and jewellery retailer Watches of Switzerland (LON: WOSG) is the worst performer on the day due to concerns about Rolex acquiring Swiss watch retailer Bucherer SA. At one point the share price dropped below 500p, but it is currently down 19.6% to 557.5p.
Watches of Switzerland is the largest retailer for Rolex in the UK, and it has multiple outlets internationally. The company, which is in the FTSE 250 index, has tried to reassure investors.
Watches of Switzerland points out that the owner of Bucherer is 86 years old and has no family succession. Rolex and Bucherer have work together for a century. Rolex says that it does not intend to make any other move into retail, and it will not have operational involvement.
More importantly, Rolex says that it will not change product allocation processes or distribution plans following the acquisition.
In July, Watches of Switzerland launched the Rolex certified pre-owned programme in the US and it will be launched in the UK in September. There are plans for Rolex boutiques in Florida in the autumn and Old Bond Street next summer, while the Glasgow boutique will be expanded. Rolex is being added to the Dallas showroom.
Luxury watches accounted for £889.9m out of group revenues of £1.54bn in the year to April 2023. That is not all Rolex, but it will be a significant contributor. Other brands include OMEGA, TAG Heuer and Breitling.
