Watches of Switzerland shares drop as Rolex acquires Bucherer
Watches of Switzerland Group’s shares dropped on Friday morning (August 25) after Rolex purchased one of its main rivals, Bucherer.
The shares of luxury retailer Watches of Switzerland (WOSG) dropped by 27% to 499p in a single day, marking a significant record drop. This has led to a total share price loss of over 40% for the year.
Just last month, shares in Watches of Switzerland, based in Leicester, went up by 13%. This was because profits increased by almost a quarter, while the company kept growing in Europe and the US.
However, a decrease in the desire for luxury jewellery, along with slower sales in the UK and Europe, led to a drop in its overall earnings.
It has been reported today that, the management attempted to minimize the significance of the news, stating that Bucherer had been a retail partner of Rolex for a long time.
They mentioned that Rolex had clarified that this acquisition aligns with the plans of Jorg G Bucherer, the 86-year-old owner and third generation of the Bucherer family, to ensure the business’s future due to the absence of family succession.
The management emphasized that this move isn’t a strategic shift into retail for Rolex and that Rolex won’t be involved in the day-to-day operations of the Bucherer business.
They also assured that there will be no changes in how Rolex manages the allocation and distribution of their products.
Still, reports suggest that professionals in the field regard this action as a potential catalyst for significant change in the market’s landscape