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New York company buying NC-based Belk for $3 billion
New York-based Sycamore Partners is a private equity firm that specializes in consumer and retail investments.
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Sycamore Partners will acquire 100 percent of Belk in a transaction with an estimated enterprise value of about $3 billion, according to a release.
Belk, which is the largest family owned department store chain in the country, has stores in all of the major cities here in Eastern Carolina.
The merger agreement was unanimously approved by Belk’s board of directors. Founded in 1888 by William Henry Belk, the company is in the third generation of Belk family leadership.
The broader department-store industry has struggled in recent years, hurt by slowing foot traffic at shopping malls and customers seeking bargains. It’s attempting to cope with the slump by experimenting with off-price locations and adding new brands.
Macy’s is also under pressure to squeeze more money from its properties with a REIT.
Commenting on the transaction, Tim Belk, chairman and CEO of Belk said, “We plan to grow Belk by executing our current strategic initiatives and undertaking new growth initiatives together with Sycamore”. It’s unclear whether any Belk stores will have to close as a result of the deal.
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Certain Belk stockholders have agreed to vote shares owned or controlled by them representing, in the aggregate, a majority of the voting power of Belk’s shares, in favor of the transaction. But Belk’s profits have lagged behind its competition and in April the chain announced it was partnering with Goldman Sachs to find a potential buyer.