NEW YORK -- Business Development Group said Thursday that it has entered into a nonbinding letter of intent to purchase Fingerhut from Federated Department Stores.
As reported, BDG earlier this month signed a confidentiality agreement with Federated. BDG, the turnaround firm based in Wayzata, Minn., still has to complete additional due diligence and finalize a financing package for the acquisition. Preliminary figures were not disclosed, but the agreement was for substantially all of Fingerhut's assets, which include Fingerhut and the catalogs operated under the Arizona Mail Order operation. Membership-focused Popular Club catalog was not listed as an asset that drew BDG's interest.
Under the terms of the letter agreement, BDG must notify Federated by early March of the status of its intent to proceed with its purchase of Fingerhut. If BDG chooses to proceed, a definitive purchase agreement could be signed at that time.
Peter Lytle, managing partner of BDG, said in a statement, "We remain positive about our ability to complete this transaction."
In a separate statement, Ronald W. Tysoe, Federated's vice chairman, said, "We are pleased that we have been able to enter into this letter of intent with BDG and, although there are no guarantees of a successful outcome, we are hopeful that we will be able to conclude a transaction with BDG."
Federated has been under attack, and is the subject of a shareholder lawsuit for the way the retailer handled the announcement to close the Fingerhut catalog operation. Tysoe said Thursday that the sale of Fingerhut as a going concern remained that retailer's top priority.
As reported, a number of entities have expressed interest in either the Fingerhut operation or select catalogs. Some of those names include Thomas Petters of the The Petters Cos., former Fingerhut president Ted Deikel and the Texas Pacific Group.
Tysoe said there were no active discussions with any other parties regarding the acquisition of Fingerhut as a going concern, although the sale process remained open.
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