Bailey Banks & Biddle, considered the nation’s oldest jeweler, has come back from the dead, with a new owner opening five new-format U.S. stores just before the 2010 holiday sales season.

The venerable high-end brand was sold by Zale Corp. to Finlay Enterprises in 2007 and was subsequently dissolved when Finlay liquidated in 2009. Immediately afterward, a new group—led by Paul Leonard, a Zale veteran who headed the BBB division in the 1990s—bought its intellectual property.

“Bailey has been around since 1832. It has high consumer awareness,” says Leonard, now president and CEO. “We think it has the ability to be resilient.”

The private-equity–backed chain is described as a “hybrid of online and bricks and mortar.” Says Leonard: “Consumers will always have the option of visiting us in the store. They don’t have that option with other online retailers.”

While it currently has only five stores—in Houston, Austin, and Plano, Texas; St. Louis; and King of Prussia, Pa.—it plans to open five to 10 new locations a year to reach 50 by 2015. “Our goal is to have national representation within five years,” Leonard says.

He maintains that the new chain will be “extremely well priced” compared with other brick-and-mortar retailers due to its online component and lower rent costs. “We are aiming at the old Bailey customer base—the high-end consumer—as well as the younger aspirational consumer,” he adds.

One big change: In addition to its finished jewelry, the company will also have a prominent “replica” department. “When customers walk in, they will see our design studio with flat-screen TVs,” says vice president of stores Julie Keeney. “That will let them surf our site on a 55-inch flat screen and select diamonds from our website. It will make it a fun, interactive environment.”