NEW YORK — R. Brad Martin surprised the retail and investment communities in 1998 when he orchestrated Proffitts' acquisition of Saks Fifth Avenue.
Proffitts at that point had purchased secondary market department stores with moderate price points such as Jackson, Miss.-based McRae's, Des Moines-based Younkers and Carson Pirie Scott, headquartered in Milwaukee.
Few were surprised yesterday, however, when Saks Inc. announced that Martin would step down as the company's chief executive officer. His scaled back responsibilities will include Parisian, Club Libby Lu and real estate matters. Stephen I. Sadove, vice chairman and chief operating officer, will become ceo of Saks Inc. and will oversee Saks Fifth Avenue Enterprises.
Martin's tenure has been anything but uneventful.
The flagship Saks Fifth Avenue chain has been hit by scandal. The Securities and Exchange Commission and the U.S. Attorney's Office in Manhattan are investigating the store's excessive allowances for markdowns. In addition, financial results have been disappointing. Saks Department Store Group posted a total sales decline of 19.6 percent to $680.6 million as comparable-store sales rose 0.1 percent in the third quarter. In the second quarter, the Saks Fifth Avenue Enterprises division reported an operating loss of $42.8 million.
Nonetheless, friends said Martin's move was his decision.
"Brad is an entrepreneur and he had this thing [Saks Inc.] and it's just a transition to the next thing," said designer Josie Natori. "He got into this by accident. He has so many businesses. No one could be happy with the bad press."
Some experts pointed out that Martin has had his share of successes, including the sale of the northern department store group to Bon-Ton Stores Inc. for $1.1 billion.
Martin didn't care about ascending the heights of Manhattan society. He bought an apartment here, but never moved in and often complained about what he called "the merchant princes" of the city who thought they knew everything about fashion. A Tennessee boy, Martin served five terms as a member of the state's House of Representatives and was the youngest person elected to the Tennessee General Assembly. He was elected two days after his 21st birthday in 1972.
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