Cincinnati, Terry Lundgren has made up his mind: Lord & Taylor is out. Federated Department Stores, Inc. plans to divest its Lord & Taylor division and the company expects to complete a transaction prior to the end of 2006.
"After a thorough review, we have concluded that Lord & Taylor does not fit with our strategic focus for building the Macy's and Bloomingdale's national brands," said Lundgren, Federated's chairman, president and CEO. "However, Lord & Taylor is a niche specialty retailer with a great name, many outstanding locations, an experienced management team and a strong customer following that makes it a desirable business."
Lord & Taylor, based in New York, operates 55 stores in New Jersey, New York, Illinois, Massachusetts, Connecticut, Maryland, Virginia, Michigan, Pennsylvania, Missouri, Delaware, Florida and the District of Columbia. The division's 2004 sales were $1.566 billion.
Federated will now account for Lord & Taylor as a discontinued operation in its monthly sales and quarterly earnings reports. This is expected to reduce fourth quarter 2005 earnings from continuing operations by approximately 10? per share.
Goldman Sachs and JPMorgan Chase are advising Federated in the divestiture process.