Meet The New Montblanc CEO

Nicolas Baretzki

Nicolas Baretzki has been named the new CEO of Montblanc, effective April 1, 2017. 

Compagnie Financière Richemont SA, which owns the German luxury brand, made the announcement in a brief statement released late Tuesday. 

Baretzki will replace Jérôme Lambert, who has held this position since 2013. Lambert will move to Head of Operations at Richemont responsible for central and regional services and all its brands other than jewelry and watchmaking at Richemont.

No reason was given for the executive changes.

Baretzki joined Montblanc in 2013 as executive VP of sales. He has worked at Richemont brands since 2002. After graduating from HEC (Ecole des Hautes Etudes Commerciales) in Paris, he began his career at Cartier where he worked in various marketing and general management functions for eight years. He then moved to Jaeger-LeCoultre in 2002 and served as international sales director for 12 years.

“I am very pleased that Nicolas Baretzki will become the Maison’s CEO,” Lambert said in the company-issued statement. “Mr. Baretzki has played an important role in the successful development of the Maison in the recent years and will be the right person to ensure the continuation of this route.”

Compagnie Financière Richemont SA owns a number of luxury brands in jewelry, watches and other luxury categories. In addition to Montblanc, Cartier and Jaeger-LeCoultre, they include: Van Cleef & Arpels, Giampiero Bodino, A. Lange & Söhne, Baume & Mercier, IWC Schaffhausen, Jaeger-LeCoultre, Officine Panerai, Piaget, Roger Dubuis and Vacheron Constantin. 

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Global Slump In Gold Jewelry Demand

Gold jewelry demand in the third quarter of 2016 fell 21 percent, year-over-year, to 493.1 tons largely due to high prices for the precious metal on the world market, according to the World Gold Council. However, every region faced its own difficulties that contributed to the decline.

“Barring just three or four very minor exceptions, jewelry demand fell in every consumer market that we track,” WGC said in its quarterly report, “Gold Demand Trends.”

The third quarter of 2016 was the largest decline since the second quarter of 2014 and the lowest third quarter for jewelry demand since 2011—a time when average gold prices were about 28 percent higher than recent levels. Year-to-date jewelry demand is down 18 percent from last year at 1,423.6 tons, the lowest total since 2009.

The WGC, the market development organization for the gold industry, expects a stronger fourth quarter due to gift-giving holidays throughout the world as well as a drop in the price of gold in October. However, it points out a number of troubling trends that may continued through the end of the year, including the changing tastes of Chinese consumers, the weal consumer environment in European markets, hesitant buying in the U.S. and the US and ongoing conflicts in the Middle Eastern.

India and China Lead the Decline
India demand fell 28 percent, year-over-year, to 154.7 tons in the third quarter due to higher and volatile prices of gold along with fragile sentiment among rural consumers and government regulation as it tries to force the industry to be more transparent, WGC said. India’s share of total jewelry demand has shrunk from 28 percent in 2015 to 24 percent year-to-date.

“India has taken a smaller slice from a smaller pie,” according to the report

On the flip side gold recycling has spiked in the country. The WGC expects rural sentiment to improve in the fourth quarter. 

Meanwhile, in China, the country’s appetite for gold is waning as gold jewelry demand fell 22 percent to 141.5 tons, as gold prices reached the highest level since 2013.

In addition, the WGC said consumer preferences are evolving in China, aided by industry efforts. Tastes are shifting away from traditional 24k gold towards higher-designed 18k or gem-set pieces. 

“However, this shifting landscape is not purely being driven by changing consumer tastes, according to the report. “Producers are playing a key role in promoting these products due to the higher margins they generate. The industry is still consolidating and competition is fierce. Manufacturers, wholesalers and retailers are battling for market share. Recognition of the importance of brand has led companies to promote their brands more actively through a range of channels, including franchising, celebrity endorsements and media.”

In addition, gold jewelry is competing with the rising popularity of travel and experiences among Chinese. 

Southeast Asia
“Jewelry demand was universally weaker among the smaller markets in as consumers balked at gold prices around three-year highs,” the WGC said in its report. 

In Indonesia, the largest market in the region, demand fell by 6 percent year-over-year in relation to slower-than-expected GDP growth in the country.

South Korea witnessed the largest decline in the region, down 24 percent, year-over-year, to 2.8 tons, again led by the high gold price along with economic deceleration in China, which purchases around 25 percent of South Korea’s exports. 

Japan was also affected by China’s influence as mainland tourists have been less active in buying gold during their travels to Japan. Demand slipped 4 percent to 4.2 tons.

Middle East in a "Parlous State"
The WGC describes jewelry markets as being in a “parlous state” against a backdrop in regional conflicts with record lows in gold jewelry demand. The region saw a 24 percent year-over-year decline to 24.1 tons, due to cuts in tourist demand, high gold prices and lower oil revenues. 

In Egypt, demand fell by 50 percent for the period due to a currency crisis that has almost doubled the price of local gold over the first three quarters of 2016. 

In the UAE and Saudi Arabia, demand in both markets plunged 23 percent.

The only bright spot was Iran, which managed a 6 percent year-over-year increase in demand to 11 tons.

Turkey saw a 22 percent drop in demand to 9.4 tons due to a slowing economy, record local prices and uncertainty following the attempted coup, the WGC said. Prospects for the fourth quarter remain weak as well.

United States Growth Stalls
For the first time in three years, U.S. gold jewelry demand declined by a modest 1 percent to 26.2 tons. Year-to-date demand of 74.6 tons is almost exactly on a par with last year. 

“Jewelry imports subsided during the quarter as inventory levels across the supply chain are at healthy levels,” WGC said. “Uncertainty associated with the presidential election campaign undoubtedly explains a portion of this weakness, but research

suggests that wealthy consumers have also become more reluctant to spend amid concerns about the global economy.”

European Demand Remains Soft
The WGC says poor consumer confidence across European markets had an effect on gold jewelry demand, which was down 1 percent to 12.6 tons in the third quarter. 

In France, demand has fallen to the lowest level in the history of WGC record keeping. In the third quarter, year-over-year demand dropped 4 percent to 1.9 tons. The country recently introduced a 9k gold segment.

“The market faces the continued risk of silver eating into the market share of low-carat gold jewelry,” the WGC said. 

All other European markets saw year-over-year declines of 1 to 2 percent for the third quarter with the exception of Spain, which reported a 2 percent gain. 

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Sarah Jessica Parker And Kat Florence Unveil Diamond Jewelry Collection

Sarah Jessica Parker in the ad campaign for Kat Florence’s “Flawless Diamond Collection” (Photo by Peter Lindbergh)

Sarah Jessica Parker and London jewelry designer Kat Florence have introduced a new collection of jewelry using D color diamonds called the “Flawless Diamond Collection.”

The collection will be unveiled over several months and organized into “chapters.” It is expected to grow to 120 individual designs across 10 chapters, “making it the largest collection of D grade diamonds ever created,” according to Florence. The first four chapters launched October 26 include pieces starting at $1,600.

Sarah Jessica Parker, Kat Florence and photographer Peter Lindbergh

D color is highest color grading a white diamond can receive. It means the diamond is colorless, which is rare. Flawless is the highest grade in the clarity scale. Diamonds that are D color and flawless or internally flawless are very rare. Florence said it took her a year to build a flawless, D-color diamond supply before she could create the collection.

The collection was created in collaboration with the actress and fashion icon, Sarah Jessica Parker, “who is the essence of the Kat Florence woman, making her the perfect person to work with Kat to develop these strikingly beautiful diamond pieces,” Florence said.

Jewels from the Flawless Diamond Collection. (Photo by Peter Lindbergh)

Parker reportedly was originally supposed to model the collection but then became involved in the design process, according to this story. She still modeled for the collection which was photographed by famed photographer and movie director, Peter Lindbergh. 

It’s not the first time Parker has collaborated in a jewelry design project. In 2014, she worked with high jewelry artist Cindy Chao to create a one-of-a-kind butterfly brooch that was auctioned at Sotheby’s Hong Kong for $1.2 million. All the proceeds went to the New York City Ballet. 

The four chapters in the Flawless Diamond Collection that were recently released are as follows:

Butterfly from the Pavé Hews Chapter

Chapter 1 – Pavé Hews
Pavé is French for pavement. Diamond pave is a traditional technique where tiny diamonds are set close together to create a seamless and glittering surface of jewels. “I focused on the uniform placement of the diamonds to ensure they capture the light from every angle,” Florence said. 

Majestic Gold from the Heritage chapter

Chapter 2 – Heritage
Inspired by Florence’s travels, the pieces reflect the sleek angles of Art Deco design, found in the iconic architecture and designs of New York. Paris and Rome.

Hearts of Gold from the Opulence chapter

Chapter 3 – Opulence
Polished 18k gold sprinkled with diamonds.

Leaves of Gold from the Symmetry chapter

Chapter 4 – Symmetry
A melding of past and present, with the angles, lines and floral motifs of 1920s and 30s design recreated in contemporary designs. Diamonds are set in 18k yellow and white gold.

“Kat Florence allows for an intimate way to wear jewelry—Kat can tell you about every piece, what it means to her and why she chose a particular technique,” Parker said in a statement. “The Flawless Diamonds Collection feels special when you wear it because every piece is so important to her. Kat is a woman doing this her own way and you feel lucky and privileged to be wearing her jewelry.” 

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Alex Soldier Designs Princess Grace Award Given To Queen Latifah by Prince Albert II and Princess Charlene of Monaco

Prince Albert II and Queen Latifah who is holding the Prince Rainier III Award created by Alex Soldier

New York-based jewelry artist Alex Soldier designed the Prince Rainier III Award that was given to Queen Latifah during the 2016 Princess Grace Awards Gala, held at Cipriani's 25 Broadway in New York City.

Prince Albert II and Princess Charlene of Monaco presented the award to the famous singer and actor for her philanthropy across many charities

The Prince Rainier III Award created by Alex Soldier

Soldier is known for his handmade jewels and art objects. The lean statuette incorporates symbols representing all three disciplines that were close to the heart of Grace Kelly, princess of Monaco, and lauded by the foundation: theater, dance and film. It is composed of connected symbols denoting these three art forms. The modern streamline award also features an abstract version of the American flag and the PGF-USA logo in a repeated pattern. It’s made primarily of platinum-plated silver with black obsidian and Swarovski crystal accents. The metalwork displays a special texturing technique that is signature to Soldier’s style. He created smaller versions of the award, which were presented to each Princess Grace Awards winner to wear as a pin.

The award was named in honor of Prince Rainier III who helped begin the Foundation more than 30 years ago to honor his wife, Grace Kelly’s legacy.

The Princess Grace Foundation-USA—which awards grants in the form of scholarships, apprenticeships, and fellowships to emerging talent in theater, dance and film—commissioned the New York-based artist to create the award in 2009 to present to a celebrity in the arts each year who has made it his or her personal mission to give back. The design has been used ever since.

Alex Soldier White Swan earrings worn by Queen Latifah

Alex Soldier’s jewels were also in full view during the event. Latifah wore Soldier’s White Swan Earrings. The form of the center stone resembles a swan's head, and the elongated diamond bar is curved into the shape of its neck. The Limited edition drop earrings are made with a white topaz center stone, white quartz and white diamonds.

Jewelry designer Alex Soldier (right) attends the 2016 Princess Grace Awards Gala with his daughter Maria, Alex Soldier brand’s creative director. (Photo by Dimitrios Kambouris/Getty Images for Princess Grace Foundation)

Soldier attended the event with his daughter Maria, Alex Soldier brand’s creative director. She wore several Alex Soldier jewels, including the Aster Flower centered with a large, faceted lemon citrine Astra with yellow sapphire and white diamond accents and detailed metalwork. It can be worn as a brooch, pendant, ring or a cuff. She also wore the Swirl cuff with rhodolite garnets; and Royal Earrings made of blue topaz, lemon citrine and rhodolite garnets set in 18k white gold.

The Alex Soldier Aster Flower jewel centered with a large, faceted lemon citrine with yellow sapphire and white diamond accents. It can be worn as a brooch, pendant, ring or cuff.

Other event highlights: Leslie Odom Jr. and Camille A. Brown received the Princess Grace Statue Award. Naomi Campbell served as the evening’s host and NYC Ballet principals Tiler Peck (Princess Grace Award Winner) and Robert Fairchild performed.

Alex Soldier Swirl cuff with rhodolite garnets

Established more than 30 years ago by Prince Rainier III to honor his wife Grace Kelly, princess of Monaco, the Princess Grace Foundation-USA’s annual gala celebrates the outstanding accomplishments of emerging artists in theater, dance and film in the presence of the royal family of Monaco.  

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Investor Group To Acquire Blue Nile And Take It Private as Q3 Sales Drop 4.3%

In a Monday morning shocker, online jeweler Blue Nile said Monday that it has entered into an agreement to be acquired by an investor group led by Bain Capital Private Equity and Bow Street LLC. The all-cash deal is valued at $500 million. 

the investor group will acquire 100 percent of the outstanding shares of Blue Nile common stock. Blue Nile stockholders will receive $40.75 in cash per share, representing a premium of approximately 34 percent over Blue Nile's closing price on November 4.

An interesting tidbit from a personal perspective is that I was able to view the Blue Nile Fulfillment Center operation and recently wrote about it for Forbes.com. Was I used to help finalize the deal?

The acquisition deal, which requires customary closing conditions, including the approval of Blue Nile's stockholders and regulatory approvals, is expected to close in the first calendar quarter of 2017, the companies said in a joint statement.

“Since its inception, Blue Nile's guiding principle has been to provide value to its customers, suppliers and shareholders and this transaction provides tremendous value to all,” Harvey Kanter, Blue Nile chairman, CEO and president, said in the statement. “Blue Nile will continue its innovative drive that has disrupted the diamond industry and made us the smartest, easiest, and most pressure-free way for consumers to buy a diamond.”

Ryan Cotton, managing director at Bain Capital Private Equity added, “This is an opportunity to acquire a true disruptor in a fundamentally attractive and growing segment of the diamond industry…. We believe the company will continue to grow as educated consumers continue to seek easy and convenient shopping experiences that deliver transparent pricing and enhanced value.”

Howard Shainker, managing partner at Bow Street said, “Blue Nile is a unique business with a strong platform in an industry that is rapidly evolving and migrating online. We are excited to work alongside Blue Nile management and Bain Capital to execute on the company's strategy.”

Blue Nile's board of directors unanimously approved the deal and recommended that stockholders vote their shares in favor of the transaction. Blue Nile will become a privately-held company and continue to be headquartered in Seattle. 

Blue Nile also may solicit alternative acquisition proposals from third parties during a 30-day “go-shop” period, following the date of execution of the merger agreement.

The announcement came at the same time Blue Nile released its third quarter earnings report, which showed a year-over-year net sales decline of 4.3 percent to $105.1 million for the period ended October 2. The report was issued without comment and a conference call scheduled for Monday was abruptly canceled. 

Operating income for the quarter totaled $1.8 million, representing an operating margin of 1.7 percent of net sales, compared to $3 million in operating income and 2.8 percent operating margin for the third quarter 2015. Net income totaled $1.3 million, or $0.11 per diluted share versus $2 million, or $0.17 per diluted share for the third quarter 2015.

Non-GAAP adjusted EBITDA for the quarter totaled $4.2 million compared to $5.3 million for the third quarter 2015. 

Other third quarter highlights include the following:

* U.S. engagement net sales decreased 8.5 percent to $59.5 million. 

* U.S. non-engagement net sales increased 1.2 percent to $25.3 million. 

* International net sales increased 1.8 percent to $20.3 million. Excluding the impact from changes in foreign exchange rates, international net sales increased 4.2 percent. 

* Gross profit totaled $20.6 million. As a percent of net sales, gross profit was 19.6 percent compared to 19.3 percent for the third quarter 2015. 

* Selling, general and administrative expenses were $18.8 million, compared to $18.2 million in the third quarter 2015. This included stock-based compensation expense of $1 million for the third quarter 2016 and $1.3 million for the third quarter  2015. 

* At the end of the third quarter, cash and cash equivalents totaled $40.6 million.

As far as the acquisition, BofA Merrill Lynch is serving as exclusive financial advisor to Blue Nile, and Wilson Sonsini Goodrich & Rosati is serving as its legal advisor. Goldman Sachs & Co is providing debt for the transaction, and Kirkland & Ellis LLP is serving as legal advisor to the Investor Group. 

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Graff Diamonds Reveals Largest D Flawless Heart-Shaped Diamond In The World

The Graff Venus

Graff Diamonds just unveiled “The Graff Venus.” At 118.78 carats, the London-based jeweler said it is the world’s largest D-color, flawless heart-shaped diamond.

This is a diamond that is not only large but is among the purest in color, clarity and cut. The D color grade means it is colorless, the top of the color scale for diamonds. It is flawless, the top of the clarity scale. It is a Type IIa diamond, meaning it is almost or entirely devoid of impurities. They make up between 1 and 2 percent of all natural diamonds.

The diamond also possesses excellent polish, excellent symmetry and no fluorescence—again the very highest accolades a diamond can achieve. 

The Graff Venus was cut from a 357-carat rough diamond discovered in 2015 at the Letšeng Mine in Lesotho, the company said, addition that Laurence Graff, the founder of the London-based high jewelry brand, “knew instinctively that hidden within its depths lay the potential to create diamond history—it displayed an outstanding size, color and clarity of the highest standard.” 

The company added, “A heart shape diamond must be perfectly faceted and entirely symmetrical to ensure a perfect silhouette and exquisite scintillation. The exceptional size of the heart required the development of special tools and new technologies. The process was incredibly risky and tense.”

From discovery to completion, the process of analysis, cutting and polishing the diamond took 18 months.

More than half of the world’s top 20 largest diamonds discovered this century have been cut and polished by Graff. 

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The Popular Solange HOTLIPS Rings Now Available Online

British high jeweler Solange Azagury Partridge has launched a new eCommerce website in the U.S., offering her famous HOTLIPS core collection of rings for an obtainable $95. They normally sell for $2,000.

Known simply as Solange, the jeweler specializes in one-of-a-kind creations that are showcased in the wildly creative interiors of her boutiques. Her pieces appear in the collections of the Musee des Arts Decoratives in Paris and the Victoria and Albert Museum in London. 

Her most popular collection is HOTLIPS, rings in the shape of lips made of 18k gold often covered with colorful details made of everything from hand-painted lacquer to precious gems. They became her most iconic item, popular with many celebrities, including Scarlett Johansson, Lady Gaga, Penelope Cruz, Emma Watson and Cara Delevingne.

Solange Azagury Partridge

The rings for the U.S. website will be made of silver and hand-painted lacquer for an attainable price of $95.00 at www.hotlipsbysolange.com.

Her core collection is now available and consists of:

* Classic Red signifying the passion and power of love;

* Black Cherry signifying a mysterious kind of love;

* Bubblegum Pink signifying an innocent and sweet kiss; and

* Nude signifying an elegant and sophisticated kiss.

More colors and designs will be released throughout the next year, including a collaboration with Project (RED) around World Aids Day and a series of flag rings.

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