NEW YORK — Preliminary bids for the Northern Department Store Group of Saks Inc. are due by the end of this week, with The Bon-Ton Stores Inc. among the probable participants, according to financial sources.
Bon-Ton, a $1.3 billion regional retailer based in York, Pa., is likely to team with a private equity firm in the bidding.
Saks Inc. could not be reached for comment.
Bon-Ton has a history of acquisitions, including its 2003 purchase of Elder-Beerman. The purchase of the Northern Department Store Group, which includes Carson Pirie Scott, Bergner's, Boston Store, Herberger's and Younkers, would be Bon-Ton's biggest.
"The Bon-Ton people have been out looking for money," said a financial source. He added that he believed the field of strategic buyers for the Northern Department Store Group would be small. Analysts have suggested J.C. Penney and Dillard's as other possible strategic bidders.
Bain Capital Partners is a private equity firm also eyeing Saks' group, as reported
Another source said Bon-Ton would not have the money to buy the Northern Department Store Group on its own.
Cerberus Capital Management is one possible partner for Bon-Ton in a bid, though the private equity firm, based here, could do it on its own. The company is due to soon close on its acquisition of Rafaella Sportswear. Cerberus already owns Mervyn's and Fila, and once considered acquiring Bill Blass. In the $1.65 billion acquisition of Mervyn's from Target Corp., Cerberus was part of a consortium that included Sun Capital Partners and Lubert-Adler/Klaff and Partners. Cerberus tends to make investments in distressed companies. Past investments were in G&G, Guilford Mills and Frederick's of Hollywood.
Bon-Ton operates 139 department stores and two furniture stores in small markets in 16 states from the Northeast to the Midwest. Stores are either called Bon-Ton or Elder-Beerman. The stores emphasize moderate to better-priced apparel, cosmetics, shoes, accessories and home goods, similar to the Saks Inc. stores, and are usually the primary department store in the market.
R. Brad Martin, chairman and chief executive officer of Saks Inc., recently told WWD that the NDSG is "quite profitable. The stores are either number one or number two in their marketplaces. In the Chicago, Milwaukee, Des Moines and Omaha markets, we're the number-one [retail department store] business, and we are a terrific emerging business in Michigan. We are the number-two business in metro Chicago," next to Marshall Field's.Buyers of the NDSG, Martin explained, could strengthen market share as Federated Department Stores Inc. sells off stores in certain markets due to its acquisition of May Department Stores Co.
Saks Inc. is selling its Proffitt's and McRae's chains, considered the Southern Department Store Group, to Belk Inc. for $622 million in cash, plus the assumption of $1 million in capitalized lease obligations and certain other liabilities. The deal is expected to close on Tuesday. Belk's is not considered a strong candidate for the NDSG.
Saks is also seeking to sell its Club Libby Lu chain, but said it plans to continue to operate its 38-unit Parisian chain as well as its Saks Fifth Avenue division.
SDSG, excluding Parisian and the nameplates sold to Belk, generated revenues of $2.2 billion in 2004 on a store base of 143 units throughout 12 Midwestern and Great Plains states.
The sale of the department stores to Belk, and whoever buys the NDSG, unravels a strategy Saks' Martin formulated in the Nineties, which involved buying regional chains and, in 1998, purchasing Saks Fifth Avenue to form Saks Inc. The entire Saks Inc. department store group does $3.7 billion in volume.
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast