Stage Stores Signs Definitive Agreement to Acquire B.C. Moore & Sons, Inc.; Acquisition of 78 Store Chain Accelerates Company's
20 Fevereiro 2006 - 3:27PM
Business Wire
Stage Stores, Inc. (Nasdaq:STGS) ("Stage" or the "Company") today
announced that it has entered into a definitive agreement to
acquire privately owned B.C. Moore & Sons, Inc. ("B.C. Moore")
for approximately $37.0 million in cash. The transaction, which has
been approved by the Boards of Directors of Stage and B.C. Moore,
is expected to close within the next thirty days and is subject to
customary closing conditions. In purchasing B.C. Moore, the Company
will acquire 78 retail locations, located in small markets
throughout Alabama, Georgia, North Carolina and South Carolina. The
Company's integration plan calls for 69 of the acquired locations
to be converted into Peebles stores, and the remaining 9 locations
will be closed. Existing merchandise inventories will be liquidated
at all stores, and the continuing 69 stores will be remodeled,
re-merchandised, and reopened as Peebles stores. The grand openings
of the newly converted Peebles stores will occur in phases
beginning in July through October. In order to allow it to remain
focused on its core business and operations, the Company expects to
engage a third party to manage the acquired stores through the
completion of the inventory liquidation sales process. The Company
noted that it is not acquiring B.C Moore's corporate office, two
distribution centers, or any other real estate. However, these
facilities will be available for the Company to use during the
transition period. After the acquisition, the Company's aggregate
store count in Alabama, Georgia, North Carolina and South Carolina
will increase from 30 stores to 99 stores, as follows: -0- *T
Number of Stores ------------------------------------------------
State Existing Acquired Combined ----------------------
--------------- --------------- --------------- Alabama 10 9 19
Georgia 2 26 28 North Carolina 15 9 24 South Carolina 3 25 28
--------------- --------------- --------------- 4 State Total 30 69
99 *T Jim Scarborough, Chairman and Chief Executive Officer of
Stage, commented, "We are extremely enthusiastic about this
transaction due to its significant strategic benefits. It expands
and strengthens our position in the Southeast, and it provides us
with good real estate locations in many of our targeted markets in
these states. It also eliminates a potential competitor, and it is
consistent with our corporate strategy of increasing the
concentration of our store base into smaller and more profitable
markets." Mr. Scarborough continued, "The acquired locations
represent an exceptional geographic fit with our existing store
base, with only a two store overlap. Additionally, the locations
meet our size and market demographics criteria, since the typical
B.C. Moore store is located in a market area of less than 50,000
people, is strip shopping center based, and has an average of
approximately 14,300 selling square feet. We expect to realize
operating synergies as these stores are converted to Peebles
stores, incorporated into our existing distribution system and
managed from our South Hill, Virginia administrative offices." Mr.
Scarborough concluded, "The acquisition of B.C. Moore represents a
logical next step for us following our successful integration of
Peebles. It significantly enhances the strategic and geographic
development of our business, improves our competitive position, and
presents us with a compelling opportunity for increased sales and
earnings. Our small market expertise, coupled with the investments
that we have made in our systems, distribution centers and
infrastructure, gives us confidence in our ability to successfully
convert, integrate, and grow these 69 additional stores." The
Company stated that it expects the converted stores to contribute
sales of approximately $95.0 to $100.0 million in fiscal 2007,
which will be their first full fiscal year of operation. The
Company also stated that, due to the magnitude of the conversion
activities that will be taking place following the closing of the
transaction, it has scaled back its original organic store opening
plans for fiscal 2006 of between 40 and 50 new stores, and now
anticipates opening between 30 and 35 new stores during the fiscal
year. When these organic store openings are combined with the
acquired and converted B.C Moore stores, the Company will be
opening a total of approximately 100 new stores during the fiscal
year. Lehman Brothers Inc. acted as exclusive financial advisor to
Stage on this transaction. Conference Call Information The Company
will host a conference call at 8:30 a.m. Eastern Time on Tuesday,
February 21, 2006 to further discuss the items contained in this
news release. Interested parties can participate in the Company's
conference call by dialing 703-639-1122. Alternatively, interested
parties can listen to a live webcast of the conference call by
logging on to the Company's web site at www.stagestores.com and
then clicking on Investor Relations, then Webcasts, then the
webcast link. A replay of the conference call will be available
online until midnight on Friday, March 3, 2006. About Stage Stores
Stage Stores, Inc. brings nationally recognized brand name apparel,
accessories, cosmetics and footwear for the entire family to small
and mid-size towns and communities through 550 stores located in 31
states. The Company operates under the Stage, Bealls and Palais
Royal names throughout the South Central states, and under the
Peebles name throughout the Midwestern, Southeastern, Mid-Atlantic
and New England states. For more information about Stage Stores,
visit the Company's web site at www.stagestores.com. "Safe Harbor"
Statement This news release contains "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995, including comments regarding the anticipated benefits, as
well as the plan of integration and conversion, of the acquired
B.C. Moore locations, comments regarding the anticipated impact on
sales from the acquisition in the 2007 fiscal year and comments
regarding the number of stores to be opened in the 2006 fiscal
year. The Company intends forward looking terminology such as
"believes", "expects", "may", "will", "should", "could",
"anticipates", "plans" or similar expressions to identify
forward-looking statements. Such statements are subject to certain
risks and uncertainties which could cause the Company's actual
results to differ materially from those anticipated by the
forward-looking statements. These risks and uncertainties include,
but are not limited to, those described in the Company's Annual
Report on Form 10-K as filed with the Securities and Exchange
Commission (the "SEC") on April 28, 2005, in the Company's
Quarterly Reports on Form 10-Q as filed with the SEC and other
factors as may periodically be described in other Company filings
with the SEC.
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