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Fairness Opinion Detail

ZLC FOOpen source

Zale Corporation to Signet Jewelers

Luxury & ApparelLuxury & Jewelry/Feb 2014/BofA

Deal Information

Target
Zale Corporation
Acquiror
Signet Jewelers
Sector
Luxury & ApparelLuxury & Jewelry
Target Type
Public
Acquiror Type
Strategic
Advisors
BofA

Transaction Metrics

Enterprise Value
$1.4B
EV / LTM Sales
EV / LTM EBITDA
18.5x
EV / Fwd EBITDA

Advisor Transaction Comparables

Comparable transactions cited by the advisor, excluding the subject transaction.

Advisor: BofA

TV / LTM EBITDA selected range: 5.6x - 12.5x

25 comps
-Oct 2012
Ultra Stores, Inc.
Signet Jewelers Limited----
-Oct 2007
Bulova Corporation
Citizen Holdings Co., Ltd.----
Sep 2007Bailey Banks & BiddleFinlay Enterprises, Inc.--8.0x-
-Oct 2006
Harry Winston Inc. (remaining 47% stake)
Aber Diamond Corporation----
Sep 2006Tourneau, Inc.Leonard Green & Partners, L.P.--12.5x-
Apr 2004Harry Winston Inc. (51% stake)Aber Diamond Corporation--10.5x-
Aug 2000Piercing Pagoda, Inc.Zale--6.2x-
Jan 2000Marks & Morgan Jewelers, Inc.Signet Group PLC--8.1x-
-Jun 1999
Peoples Jewellers (retail locations in Canada)
Zale----
Sep 2013Yankee Candle Investments LLCJarden Corporation--8.5x-
Mar 2013Hot Topic, Inc.Sycamore Partners--7.8x-
Nov 2012Cole Haan LLCApax Partners--11.5x-
Aug 2012David's Bridal, Inc.Clayton, Dubillier & Rice, LLC--9.2x-
May 2012Charming Shoppes, Inc.Ascena Retail Group, Inc.--9.8x-
May 2012Collective Brands, Inc.'s Performance + Lifestyle GroupWolverine World Wide, Inc.--10.0x-
Oct 2010The Gymboree CorporationBain Capital Partners, LLC--7.8x-
Aug 2009Charlotte Russe Holding, Inc.Advent International Corporation--5.6x-
Jun 2009Tween Brands Inc.Dress Barn Inc.--7.2x-
May 2007Express Inc.Golden Gate Capital--9.6x-
Mar 2007Claire's Stores, Inc.Apollo Management, L.P.--8.9x-
Feb 2007General Nutrition Centers, Inc.Ares Management LLC & Ontario Teachers' Private Capital--10.1x-
Nov 2006David's Bridal, Inc.Leonard Green & Partners, L.P.--10.2x-
Nov 2006La Senza CorporationLimited Brands, Inc.--10.6x-
Oct 2006Yankee Candle Investments LLCMadison Dearborn Partners LLC--10.0x-
Apr 2005Electronics Boutique Holdings Corp.GameStop Corp.--10.7x-
Mean-9.2x-
Median-9.6x-

DCF Assumptions

Discount rate and terminal value assumptions the advisor selected for its discounted cash flow analysis.

BofA

Open
WACC
11.0% – 13.0%
Terminal method
Perpetuity growth
Terminal assumption
2.5% – 4.0%
Forecast basis
business plan case (management), plus PV of NOL carry-forward and tax-credit benefits
Forecast period
February 1, 2014 through July 31, 2020
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