Moissanite gemstone maker Charles & Colvard announced Tuesday that it has sold Lulu Avenue, the Morrisville company’s home party business, to Yanbal USA.
Yanbal paid $500,000 for the unit’s assets.
Those assets include a credit to purchase $250,000 of existing jewelry inventory as well as marketing collateral and intellectual property related to the business, and an exclusive license to use the Lulu Avenue intellectual property through July 31.
Yanbal USA is part of Yanbal International Enterprises, which has nearly half a million beauty consultants selling products in 10 countries in Latin America and Europe. The Lulu Avenue purchase is part of the Yanbal’s strategy of expanding its direct-selling business into the U.S.
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Charles & Colvard sells its gemstones to wholesalers and directly to consumers through an e-commerce website, Moissanite.com. In February, the company decided to explore a sale of its Lulu Avenue direct business in an effort to “advance toward profitability.”
“This agreement allows Charles & Colvard to focus its resources and efforts on its core moissanite business,” CEO and president Suzanne Miglucci said in a statement. “We believe Yanbal USA will be a great partner for our loyal and committed Lulu Avenue style advisors and we wish them great success.”
Miglucci, a former chief marketing officer at ChannelAdvisor, took over as CEO on Dec. 1. She replaced Marvin Beasley, who retired.
Charles & Colvard reported after the markets closed Tuesday that it lost $1.9 million, or 9 cents a share, in the fourth quarter, compared with a loss of $2.8 million, or 14 cents per share, during the same period in 2014. For the year, the company lost $9.6 million, or 47 cents a share, compared with a loss of $13.1 million, or 65 cents per share, during the prior year.
Lulu Avenue accounted for 12 percent of Charles & Colvard’s $8.4 million in sales in the fourth quarter.
Charles & Colvard shares rose 18 percent Tuesday to close at $1.06. The stock is down 27 percent over the past year.