Man looking at luxury watches Rolex in his hand. AS Photo Studio / shutterstock

Bloomberg reported that one of the leading investors in Watches of Switzerland sold 5 million shares after Rolex struck a deal to acquire Bucherer.

Rolex is set to acquire the luxury watch seller in a bid to gain more control over its retail sales.

Swiss Watches’ stock fell 21% last week on the day news of the deal broke.

A major investor in Watches of Switzerland sold 5 million shares of the luxury watch seller, less than a day after news broke that Rolex had agreed to acquire rival retailer, Bucherer, according to Bloomberg.

The deal was announced last Thursday, and on Friday Edinburgh-based asset manager Aberdeen Plc reduced its stake from 8.2% to 6.1%, according to regulatory filings with the London Stock Exchange cited by Bloomberg.

Given its heritage status and fame, Rolex is a forerunner to the luxury goods market. This was demonstrated last week when its new foray into retail sent Watches of Switzerland stock down 21%.

The deal raised concerns that Rolex could capture a greater share of the retail market and away from third-party sellers such as Watches of Switzerland, which accounts for about 60% of its sales from Rolex, Patek Philippe and Audemars Piguet. Is.

Bucherer, meanwhile, is a 135-year-old watch dealer based in Switzerland that operates more than 100 shops, more than half of which sell Rolex items. If this acquisition prompts other producers to demand greater control over where and how their products are sold, this acquisition could further disrupt the watch market.

The luxury watch market is facing some headwinds. Earlier this summer, prices for name-brand watches in secondary markets hit near two-year lows. Even wealthier buyers have slowed purchases, and demand has still not picked up amid high interest rates and a softening of consumer spending.

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 Man looking at luxury watches Rolex in his hand. AS Photo Studio / shutterstock