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|Westfield to Acquire 15 Federated Stores in California, Connecticut, Maryland and Ohio|
CINCINNATI--(BUSINESS WIRE)--Feb. 17, 2006--Federated Department Stores, Inc. (NYSE:FD)(PCX:FD) today announced it has signed agreements for The Westfield Group to acquire 15 mall department store locations from Federated. Of those, 13 are duplicate locations Federated previously announced for divestiture as a result of its acquisition of The May Department Stores Company.
The other two locations are Macy's University Town Center in La Jolla, CA, and Macy's Main Place in Santa Ana, CA. Federated expects to lease back and operate these stores as Macy's, pending redevelopment of the malls and construction of new stores.
One agreement with Westfield involves a tax-deferred like kind exchange of 12 stores for 12 department store properties currently owned by Westfield and leased to Federated (acquired by Federated in the May Company acquisition). The remaining three stores will be sold to Westfield for $18.5 million in cash via a separate purchase and sale agreement.
Federated said proceeds from this transaction will be included in the $400 million to $500 million of after-tax proceeds expected from the sale of duplicate stores nationwide, as previously announced.
Clearance sales at all stores being acquired by Westfield (except for West Covina) began on Jan. 29, 2006. Macy's will continue to serve customers in these malls, including in locations where May Company nameplates will be converted to Macy's.
The transactions with Westfield are expected to be completed in the second quarter of 2006.
All statements in this press release that are not statements of historical fact are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based upon the current beliefs and expectations of Federated's management and are subject to significant risks and uncertainties. Actual results could differ materially from those expressed in or implied by the forward-looking statements contained in this release because of a variety of factors, including conditions to, or changes in the timing of, proposed transactions, the risk the company will not be able to divest the assets that its intends to divest or that the amounts realized in connection with the divestitures are less than anticipated, the risk that the company is not able to realize cost synergies expected from the merger with May Company or is not able to integrate the May Company as anticipated, prevailing interest rates, competitive pressures from specialty stores, general merchandise stores, manufacturers' outlets, off-price and discount stores, new and established forms of home shopping (including the Internet, mail-order catalogs and television) and general consumer spending levels, including the impact of the availability and level of consumer debt, the effect of weather and other factors identified in documents filed by the company with the Securities and Exchange Commission.
Federated, with corporate offices in Cincinnati and New York, is one of the nation's premier retailers, with fiscal 2006 sales expected to be more than $27 billion. Federated operates more than 850 department stores and more than 720 bridal and formalwear stores in 49 states, the District of Columbia, Guam and Puerto Rico under the names of Macy's, Bloomingdale's, Famous-Barr, Filene's, Foley's, Hecht's, Kaufmann's, Lord & Taylor, L.S. Ayres, Marshall Field's, Meier & Frank, Robinsons-May, Strawbridge's, The Jones Store, David's Bridal, After Hours Formalwear and Priscilla of Boston. The company also operates macys.com and Bloomingdale's By Mail.
(NOTE: Additional information on Federated, including past news releases, is available at www.fds.com/pressroom )
CONTACT: Federated Department Stores, Inc. Media - Jim Sluzewski, 513-579-7764 Investor - Susan Robinson, 513-579-7780 SOURCE: Federated Department Stores, Inc.