Suffern, N.Y. -- The Ascena Retail Group said Wednesday it will acquire Charming Shoppes Inc., parent company of Lane Bryant, for about $890 million.
The move gives Ascena -- which owns the Dressbarn, Maurices and Justice chains -- entry to the steadily-growing large-size women's clothing market. In addition to Lane Bryant, Charming Shoppes also owns the Fashion Bug and Catherines Plus Sizes banners. It operates more than 1,800 stores nationwide. In 2011, nearly 85% of Charming Shoppes’ sales involved plus-sized apparel.
Upon completion of the deal, which has been approved by both boards, Charming Shoppes, which is based in Bensalem, Pa., will become a subsidiary of Ascena.
“Charming Shoppes is a superb strategic fit for Ascena,” said David R. Jaffe, president and CEO, Suffern, N.Y., which operates more than 2,500 stores. “Over the past few years, we have welcomed into our family new brands and new team members while delivering increasing value to shareholders. We believe that Charming Shoppes will be no exception.”
Charming Shoppes announced last December that it was examining alternatives for the company.
“In addition to partnering with a buyer that can support the future growth and development of our businesses, the $7.35 per share consideration represents a premium of 25% to the closing market price of Charming Shoppes common stock on May 1, 2012,” Michael Goldstein, board chairman of Charming Shoppes, said in a statement. “We are confident that this transaction is in the best interests of our shareholders.”