MGM may sell parts of CityCenter project
Las Vegas — MGM Resorts International CEO Jim Murren said Wednesday that the company is considering selling parts of its $8.5 billion CityCenter project on the Las Vegas Strip, including the Crystals Mall.
The sell-off would be a move to reduce CityCenter’s $1.85 billion in debt, which has been paid down from $2.5 billion last year.
CityCenter also houses the 4,000 Arai hotel casino which, said Mullen, is not part of any potential sale.
While there are no negotiations under way, Murren told the Associated Press that the 500,000-sq.-ft. luxury mall Crystals, which features such tenants as Gucci, Prada and Tiffany, is especially enticing to investors.
MGM owns CityCenter in a 50-50 partnership with Dubai World, the investment arm of Dubai’s government.
Build-A-Bear CEO joins Foot Locker board
NEW YORK — Build-A-Bear CEO Maxine Clark has joined the Foot Locker board of directors.
Clark founded Build-A-Bear Workshop in 1997. She has extensive experience in the retail industry, having also served as president of Payless ShoeSource Inc. and for 19 years as an executive of The May Department Stores Company.
"Maxine Clark has a depth of experience in both domestic and international retailing, and she is well-known for her innovative approach to the industry," said Ken Hicks, hairman of the board and CEO of Foot Locker Inc. "We are pleased to be adding an individual with her talent and expertise to complement our already strong board of directors."
OfficeMax, Office Depot merger moves forward
NAPERVILLE, Ill. and BOCA RATON, Fla. — The office retail field narrowed Wednesday, as OfficeMax and Office Depot officially announced an agreement to merge into a single company. The combined company would have had pro forma combined revenue for the 12 months ended Dec. 29, 2012 of approximately $18 billion.
Under the terms of the agreement, OfficeMax stockholders will receive 2.69 Office Depot common shares for each share of OfficeMax common stock.
“In the past decade, with the growth of the internet, our industry has changed dramatically. Combining our two companies will enhance our ability to serve customers around the world, offer new opportunities for our employees, make us a more attractive partner to our vendors, and increase stockholder value,” said Neil Austrian, chairman and CEO of Office Depot. “Office Depot and OfficeMax share a similar vision and culture, and will greatly benefit from drawing on the industry’s most talented people, combining our best practices and realizing significant savings. We are confident that this merger of equals represents a new beginning for our two companies and will allow us to build a more competitive enterprise for the long term.”
“We are excited to bring together two companies intent on accelerating innovation for our customers and better differentiating us for success in a dynamic and highly competitive global industry,” said Ravi Saligram, president and CEO of OfficeMax. “We are confident that there will be exciting new opportunities for employees as part of a truly global business. Together, we will have the opportunity to build on our strong digital platforms and to expand our multichannel capabilities to better serve our customers and to compete more effectively. Importantly, this merger of equals transaction will provide stockholders of both companies with a compelling opportunity to participate in the long-term upside potential of the combined company.”
According to a press statement from OfficeMax and Office Depot, the combine company willbe well positioned to optimize its shared multichannel sales platform and distribution network, primarily in North America. Together, the companies will provide a wide array of services and solutions that enable customers to work more efficiently and productively. By implementing best practices in sales, operations and management, the combined company is expected to be better able to compete with the many online retailers, warehouse clubs and other traditional retailers that are placing a greater emphasis on office product sales.
The companies also noted that the merger will combine their complementary international businesses, with minimal overlap, strengthening the combined company’s ability to serve customers around the world.
Following the closing, the combined company’s newly constituted board of directors will include equal representation and governance rights from each of the two companies. The parties have also agreed to form a selection committee made up of an equal number of independent board members from each company that will oversee the search process for naming the CEO for the combined company. Both incumbent CEOs, as well as external candidates, will be considered in the search process. Neil Austrian, the Chairman and CEO of Office Depot, and Ravi Saligram, the President and CEO of OfficeMax will remain in their current positions through the completion of the search process.
The transaction is expected to close by the end of calendar year 2013, subject to stockholder approval from both companies, the receipt of regulatory approvals and other customary closing conditions.
In addition to announcing their merger, both companies reported a sales decrease and a net loss for their fourth quarter.
Office Depot reported that total company sales for the fourth quarter of 2012 were approximately $2.6 billion, down 12% compared with the fourth quarter of 2011.
The company reported a net loss, after preferred stock dividends, of $17 million or 6 cents per diluted share in the fourth quarter of 2012, compared to net earnings, after preferred stock dividends, of $12 million or $0.04 per share in the fourth quarter of 2011.
“We delivered the financial results we had projected for the fourth quarter of 2012,” said Neil Austrian, chairman and CEO of Office Depot. “Despite continued revenue pressure in North American retail and international, we successfully executed our key initiatives.”
Sales at Office Depot’s North American retail division were approximately $1.1 billion, a decrease of 13% compared with the prior year. Comparable-store sales decreased 6% for the fourth quarter of 2012.
At the end of 2012, Office Depot operated 1,112 stores in the United States and Puerto Rico. The North American retail division opened two new stores and closed four during the fourth quarter of 2012.
Office Depot’s North American business solutions division reported fourth quarter of 2012 sales of approximately $763 million, an 8% decrease compared with the prior year on a fiscal basis.
The division reported operating income of approximately $55 million in the fourth quarter of 2012 compared to $45 million in the fourth quarter of 2011.
The company’s international division reported fourth quarter of 2012 sales of $789 million, a decrease of 13% in U.S. dollars and a decrease of 11% in constant currency sales compared to the prior year.
The division reported operating income for the fourth quarter of 2012 of approximately $23 million, compared to $33 million in the same period of 2011. Email
OfficeMax reported that sales for the fourth quarter decreased 7.4% to $1.7 billion compared with the fourth quarter of 2011. The company reported a net loss of $33.9 million, or 39 cents per diluted share, compared with net income of $2.9 million, or 3 cents per diluted share, in the fourth quarter of 2011
"We’ve been making tangible progress in executing against our strategic plan," said Ravi Saligram, President and CEO of OfficeMax. "Our execution during 2012 resulted in a significant increase in earnings per share, strong cash flow from operations, and reinstatement of a quarterly dividend. After completing our comprehensive review, we’ve also simplified our balance sheet and created greater clarity for our investors."
Sales at the company’s contract segment sales decreased 5.3% compared with the prior year period to $885.4 million in the fourth quarter of 2012.
Retail segment sales decreased 9.5% to $815.1 million in the fourth quarter of 2012 compared with the fourth quarter of 2011, reflecting a same-store sales decrease on a local currency basis of 4.1% primarily due to decreased traffic and lower technology product category sales.
OfficeMax ended the fourth quarter of 2012 with a total of 941 retail stores, consisting of 851 retail stores in the United States and 90 retail stores in Mexico.