Charming Shoppes Inc. is getting $75 million for the sale of its noncore misses’ apparel catalogue titles and related credit card receivables.
This story first appeared in the August 26, 2008 issue of WWD. Subscribe Today.
The specialty chain is selling its noncore misses’ apparel catalogue titles for $35 million to Orchard Brands, a portfolio company of Golden Gate Capital.
The transaction includes the catalogue titles and the associated e-commerce sites of the following brands: Old Pueblo Traders, Bedford Fair, Willow Ridge, Lew Magram, Brownstone Studio, Intimate Appeal, Monterey Bay Clothing Company and Coward Shoe. The company said the deal is expected to close by the end of September.
In addition, Charming Shoppes said it is selling the misses’ apparel catalogue credit card receivables for approximately $40 million in cash to Alliance Data Systems Corp. The receivables are directly related to the catalogue titles being sold to Orchard Brands, Charming Shoppes said. The receivables transaction is expected to close before the end of the company’s fiscal year on Jan. 31.
Charming Shoppes added that it is also exploring the sale of its Figi’s Gift catalogue business.
While Charming Shoppes will retain the infrastructure of the sold catalogue and e-commerce businesses, it will continue to provide certain services to Orchard Brands for a limited transaction period. Those services include distribution, information technology and call center functions.
The retailer said it expects to realize pretax net cash proceeds of $43 million from the sale of the catalogues and the related credit card receivables, less securitized indebtedness of approximately $32 million.
Alan Rosskamm, chairman of the board and interim chief executive officer of Charming Shoppes, said, “We have made the decision to sell our noncore catalogues as key steps in our strategy to focus on our core brands — Lane Bryant, Fashion Bug and Catherines — and leverage our leading market share position in women’s specialty plus apparel.”
Separately, Charming Shoppes named Lori Twomey as president of its direct-to-consumer division, which includes its e-commerce operation and the Lane Bryant Woman catalogue and Web business. She reports to Rosskamm.