By  on October 19, 2007

New York & Co. Inc. said Thursday that it will discontinue the faltering JasmineSola concept to focus on higher return opportunities.

The retailer plans to exit 23 JasmineSola stores, which sold apparel and accessories targeting young women, by the end of the fourth quarter.

The shutdown will result in a noncash charge of $28 million to $30 million of intangible assets and store-level property and equipment over the third and fourth quarters. The specialty apparel retailer will look into converting some of their JasmineSola locations to New York & Co. stores and use current employees where possible.

"We believe we can generate greater shareholder value by directing our resources and capital toward growth initiatives within our core New York & Co. brand and therefore have made the difficult decision to exit the JasmineSola business," Richard P. Crystal, chairman and chief executive officer, said in a statement.

CL King & Associates analyst Mark Montagna wrote in a research note that the retailer's decision is a "positive step toward margin and earnings recovery."

Shares of New York & Co. gained 6.25 percent to close at $6.29 in trading Thursday on the New York Stock Exchange.

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