TJX sells Bob's Stores to private equity firms

NEW YORK, Aug 19 (Reuters) - Off-price retailer TJX Companies Inc (TJX.N: Quote, Profile, Research, Stock Buzz) sold its Bob's Stores unit to private equity firms Versa Capital Management and Crystal Capital. for an undisclosed sum.

TJX also raised its full year forecast for fiscal 2009 earnings as a result of the sale.

It said the sale is expected to generate cash proceeds of about $23 million, which primarily represents anticipated tax benefits, as well as the proceeds from the sale, partially offset by fees and expenses related to the transaction.

"Our decision to sell the business reflects our vision to grow TJX as a global, off-price company," TJX Chief Executive Carol Meyrowitz said in a statement on Tuesday.

Bob's is a chain of lower-cost, casual clothing and footwear superstores with about 34 locations in the U.S. Northeast. For the first half of the fiscal year, Bob's posted a loss of nearly $27 million, compared with a loss of $10 million in the same period a year earlier.

TJX will post an after-tax loss from the sale in its fiscal third quarter of about $15 million, or 3 cents per share, which will be reported as a loss from discontinued operations.

The company, which also is home to T.J. Maxx and Marshalls, said it now expects full year earnings per share from continuing operations of $2.30 to $2.35. It previously had forecast earnings per share of $2.26 to $2.31.

Excluding other items, TJX sees full year earnings from continuing operations of $2.19 to $2.24, representing an increase of up to 16 percent from the prior year.

Source: Reuters

No Stopping TJX

Millions of people have their personal financial records exposed when TJX Cos. has its computer systems hacked - not a problem. The economy softens and people reign in their spending, just not at TJX.

It appears no amount of bad news is enough to keep TJX and its chains including T.J. Maxx, Marshalls, HomeGoods and A.J. Wright from rolling right along. Sales at TJX stores open at least two years increased four percent in the latest quarter with a number of divisions in North America and Europe seeing high single and low double-digit revenue increases.

The company's CEO Carol Meyrowitz said it has benefited from being able to buy designer clothing, shoes and bedding on the cheap as department stores found themselves having to cut back on inventory and close stores.

TJX's allure is easy to understand, according to Patrick McKeever, an analyst with MKM Partners. "You know you are getting a good deal at T.J. Maxx and Marshalls,'' Mr. McKeever told Bloomberg. "If you look at off-price retailers, like TJX... you wouldn't know we're in a widespread consumer slowdown."

"In down economies, we tend to capture new customers," said Carol Meyrowitz, chief executive at TJX. "When times improve, our history has shown that our new customers stay with us because they love our value."

One TJX chain that has not fared so well is its Bobs Stores business. Same-store sales were off five percent and the company is exploring "strategic options" for the chain.

Source: RetailWire

Report: TJX Putting Bob’s Stores on Block

TJX Cos. is reportedly in discussions to sell its money-losing Bob's Stores, Bloomberg reported on Friday, citing people with knowledge of the sale process. TJX, whose brands in the United States include T.J. Maxx, Marshalls, HomeGoods and A.J. Wright, has benefited as shoppers look for cheaper alternatives. It posted a nearly 20% profit gain on a 6% increase in sales in its first quarter ended April 26. The bulk of TJX’s sales come from T.J. Maxx and Marshalls. But Bob's Stores, which TJX acquired in bankruptcy in 2003, remains in a slump. According to the report -- which cites anonymous sources -- potential buyers for Bob's include private-equity firm Versa Capital Management Inc. The report said TJX's adviser Peter J. Solomon Co. is seeking a buyer that will keep Bob's 34 stores open.

Source: Chain Store Age