HONG Kong-based watch maker and retailer Peace Mark said it will buy Singapore-based luxury watch retailer Sincere Watch in a deal that values Sincere at S$530 million.

Under the deal, Peace Mark will pay $2.564 for each Sincere share, Peace Mark said in a statement issued late on Friday.

The offer price for each Sincere share represents a 10.5 per cent premium to Sincere's Friday closing price of $2.32 in Singapore.

Peace Mark said it will pay for the purchase with 80 per cent in cash and 20 per cent in new Peace Mark shares.

The new Peace Mark shares will be issued at HK$12.096 per share or the volume weighted average price of Peace Mark shares in the last 20 trading days, Peace Mark said.

Shares in Peace Mark closed at HK$12.98 on Friday

Mr Patrick Chau, chairman of Peace Mark, said the purchase will allow the Hong Kong firm to focus on expanding in China, while Sincere focuses on South-east Asia and new markets such as India.

'We look forward to speeding up expansion of our luxury retail operations in the People's Republic of China,' Mr Chau said in a statement.

Sincere, which has a stock market value of US$331 million (S$276 million), according to Reuters data, has 38 outlets in Asia and earns 70 per cent of its revenues from South-east Asia.

Peace Mark, which has a stock market value of US$1.7 billion and runs the largest retail and distribution network for timepieces in China, said in January it wants to open up to 100 new counters and outlets across China by March next year. -- REUTERS