Target Sells Fields For $3.24 Billion
By George Anderson
For Target, it’s one down and one to go in its plan to sell off its department store chains to focus on its discount business.
Yesterday, Target announced it had reached a deal to sell Marshall Field’s to May Department Stores for $3.24 billion. Nine Mervyn’s stores in the Twin Cities were also included in the deal.
Bob Ulrich, chairman and chief executive officer of Target, said in a company release, “Our decision to sell Marshall Field’s, though not easy, reflects our long-term commitment to create substantial value for our shareholders over time, combined with our responsibility to our team members, our guests and the communities we serve. We believe that the sale of Marshall Field’s to The May Department Store Company as an ongoing business enhances the opportunity for all of our stakeholders to enjoy continued success for many years.”
May’s chief executive, Gene Kahn was equally optimistic. “This is a banner day for May. All of us here are truly excited about the potential of this acquisition, and we think it will reward the share owners handsomely.”
May doesn’t have any radical changes planned for Marshall Field’s. Mr. Kahn pointed to recent strong same-store sales performance at the chain and said, “Any changes that we make, we will give a lot of thought to. From our point of view, this is a strategic acquisition of a dynamic company. And we’re making a long-term commitment.”
May intends to operate Field’s as a separate division, with Linda Ahlers remaining president of the business. It also said it has no plans to layoff Field’s employees, although workers at nine Twin Cities’ area Mervyn’s stores included in the deal may be receiving pink slips if May does not convert the units to run under the Marshall Field’s banner.
Target also announced yesterday its Board of Directors had authorized a $3 billion stock buy-back.
Moderator’s Comment: What will the Marshall Field’s deal mean for Target and May Department Stores? How will it impact
the relative competitive clout of the two organizations? –
George Anderson – Moderator
- Target Corporation to Sell Marshall Field’s – PRNewswire-FirstCall/Target
Co. is buying Marshall Field’s – St. Louis Post-Dispatch
- A buyer for Field’s: It’s May – Minneapolis Star Tribune