Acquisition

12 Months Ended

Feb. 02, 2013

Acquisition

14. Acquisition

On October 29, 2012, Signet acquired the outstanding shares of Ultra Stores, Inc., a leading jewelry retailer operating primarily in outlet centers, from Crystal Financial LLC and its other stockholders (the “Ultra Acquisition”). As a result of the acquisition, Signet immediately increased its share of the US outlet channel for jewelry. The Company paid $56.7 million, net of acquired cash of $1.5 million, for the Ultra Acquisition, including a $1.4 million working capital adjustment at closing. The total consideration paid was funded through existing cash.

Signet incurred approximately $3.0 million of acquisition-related expenses, which were recorded as selling, general and administrative expenses in the consolidated income statement. The results of operations related to the Ultra Acquisition are reported as a component of the results of the US division and included in Signet’s consolidated financial statements commencing on the date of acquisition. Pro forma results of operations have not been presented, as the impact on the Company’s consolidated financial results were not material.

The Ultra Acquisition was accounted for as a business combination during the fourth quarter of Fiscal 2013. The Company is in the process of finalizing the valuation of the net assets acquired in the acquisition, most notably, the valuation of consignment inventory and related liabilities. Accordingly, the total consideration has been allocated to the net assets acquired based on the preliminary fair values at October 29, 2012 as follows:

(in millions)
Recognized amounts of assets acquired and liabilities assumed:
Inventories	$	43.3
Other current assets, excluding cash acquired		3.3
Property and equipment		12.1
Other assets		0.3
Current liabilities		(19.5	)
Other liabilities		(7.4	)
Fair value of net assets acquired	$	32.1
Goodwill(1)		24.6
Total consideration	$	56.7

(1) None of the goodwill will be deductible for income tax purposes.