STEINBACH CHAIN IS SOLD TO SCHOTTENSTEIN GROUP
Byline: Valerie Seckler
NEW YORK — Steinbach Inc., the operator of 26 moderately priced department stores, was sold Tuesday to an organization formed by members of the Schottenstein family, including Jay Schottenstein, chairman of Value City Department Stores and Schottenstein Stores Corp. of Columbus, Ohio.
Immediately following the sale, whose terms were undisclosed, Steinbach’s, which had been owned by American Retail Group Inc., here, was merged into its new owner, which will continue to operate as Steinbach Stores Inc.
“I believe Schottenstein will bring a lot to it,” said Jeff Branman, managing director of Financo Inc., the investment bank that did the deal. “It will be separately capitalized and run.”
Steinbach’s generated sales of $225 million in 1993, a slight increase over the prior year, according to Branman.
Profits of the privately held retailer were not disclosed, but Branman said the “very promotional” retailer has been “consistently profitable” for several years.
While Steinbach’s will continue to operate stores under its own names, Schottenstein’s buying organizations for Value City and American Eagle are expected to bring the department store chain newfound buying clout.
A source close to Jay Schottenstein said the merchant is aiming to offer better merchandise at better prices than Steinbach’s had been able to, improving gross margins in the process.
Schottenstein could not be reached for comment.
Steinbach’s stores are scattered in regional malls and strip centers throughout New York, New Jersey, Connecticut, New Hampshire and Vermont. The strongest concentration of stores, which typically range from 150,000 to 200,000 square feet, sit in a swath of upstate New York stretching from Tarrytown north to Albany and west to Syracuse.
Steinbach’s sells mostly branded men’s, women’s and children’s apparel, with vendors such as Levi’s and Haggar key brands. It goes head-to-head with J.C. Penney for consumer dollars in a number of markets.
American Retail Group’s holdings include J. Byrons and Upton’s department stores in the Southeast, Miller’s Outposts, Women’s World and Eastern Mountain Sports.
ARG officials could not be reached for comment.
— Fairchild News Service