Ascena Retail Group, with 2,500 stores under the dressbarn, maurices and Justice brands, will become an even bigger player in women's apparel with its acquisition of the 1,857-store Charming Shoppes chain in a cash transaction valued at approximately $890 million.
Charming Shoppes specializes in plus-size women's apparel, operating stores under the Lane Bryant, Catherines and Fashion Bug banners as well as an e-commerce operation. It will operate as a separate subsidiary of Ascena. The deal, which has been approved by both companies' boards of directors, is expected to close in Q2 of 2012.
"Charming Shoppes is a superb strategic fit for Ascena," said Ascena president and CEO David Jaffe in a statement. "A key component of our growth strategy over the past several years has been to make highly selective and powerful acquisitions. We've built a family of retail brands, each serving a unique customer niche, with a culture that embraces the sharing of resources, new ideas and talented team members."
"I would like to say how pleased we are to join the Ascena Retail Group," said Charming Shoppes CEO Anthony Romano. "David and his team have an excellent track record of acquiring and seamlessly integrating brands with a strong market niche and growth potential, hallmarks of our Charming Shoppes' brands. While we are proud of our progress and accomplishments and believe our brands are now poised for growth, this business combination is extremely powerful, offers a compelling premium in recognition of our significant progress and is in the best interests of our shareholders."
Earlier this week, Charming Shoppes revealed details of a multi-year IT transformation initiative that is projected to achieve $25-$30 million in cost savings by 2014, upgrading key retail systems including the POS, merchandising, inventory and financial applications.
For related content: Charming Shoppes IT Transformation Drives $25-30M in Cost Cuts by 2014
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