Fitch Lowers Blockbuster Rating
New York City, Fitch Ratings reduced Blockbuster’s debt ratings, which already had been at junk status. The arrival of Carl Icahn to the board of directors, and his previous complaints about the direction of the company, precipitated the rating change. “Fitch believes that the uncertainties related to Blockbuster’s strategic direction and fiscal policies brought on by the expected appointment of Carl Icahn and his two nominees to the board … negatively affects bondholders,” according to the New York City-based ratings service.
Saks Inquiry Widens
New York, The SEC has expanded its investigation of Saks Fifth Avenue collections to include chargebacks—the deductions merchants take on payments to apparel makers for supposedly defective or unwanted goods.
Although the retailer announced Monday that it can find no evidence of improper collections, the SEC considers its current examination, which began in early March, still open, and it can be expanded to include any indications of wrongdoing that may emerge.
Within the last month, Saks apparently has begun to return some money collected during 2004. And, on Monday, the Saks, Inc. board said it had found evidence of overcollection of vendor allowances and fired three top executives.
Children’s Retailer Carter’s to Buy OshKosh
Atlanta, Carter’s Inc. has announced that it will acquire its rival OshKosh B’Gosh for $312 million, merging two brands into one company that will generate more than $1.3 billion in annual sales.
Carter’s, which operates 181 retail stores and whose brand is sold in 3,000 department stores, will pay $26 in cash for each share of OshKosh stock; the deal includes redemption of employee stock options.
Last February, Oshkosh, Wis.-based OshKosh retained investment bank Goldman Sachs to help pursue what the company called strategic alternatives, launching speculation about the future of the brand. The retailer ran into financial trouble this year when a move into adult clothing flopped.