MONTREAL — New Look Eyewear Inc. (TSX:BCI) is spending $74 million to acquire Charlottetown-based Vogue Optical Inc. in a move that will make it the third-largest integrated optical retailer in Canada.
Vogue, founded in 1979, has a 65 stores — including 21 in Nova Scotia, 21 in New Brunswick, 15 in Newfoundland and Labrador, five in Prince Edward Island and three in other provinces.
The company, which also has a lens processing facility, reported revenues of about $40 million in the 12 months to Aug. 31.
“We feel privileged welcoming the Vogue Optical team in our organization,” New Look vice-chairman Antoine Amiel said in a statement announcing the deal Wednesday.
“Vogue Optical will operate as a stand-alone business based in Charlottetown,” Amiel said, adding that both groups will continue to grow organically and by acquisition in their respective markets.
The combined entity will have revenues exceeding $128 million and a store network with more than 140 locations, making it the third-largest Canadian integrated retail optical company and the eighth- largest in North America.
In connection with this transaction, New Look has entered into various financing arrangements providing for a senior secured debt facility of up to $75 million with a syndicate of major Canadian banks.
The financing is comprised of an acquisition term facility of up to $65 million and a $10-million revolving facility, as well as a maximum of $25 million of equity financing.
New Look has also entered into an arrangement for a $15-million junior unsecured debt facility with a Quebec-based fund which may be used to finance a portion of the acquisition, thus reducing the draw on the acquisition term facility.
The deal is expected to close in early December.
- The Canadian Press