CHARLOTTE, N.C. — Charlotte-based Belk Inc., the nation’s largest family-owned fashion department store company, has entered into a definitive merger agreement whereby investment funds managed by New York-based private equity firm Sycamore Partners will acquire 100 percent of Belk in a $3 billion transaction.
Under the terms of the transaction, Tim Belk will remain CEO of Belk and the company will continue to be headquartered in Charlotte, N.C. The merger, which was unanimously approved by Belk’s board of directors, is expected to be completed by the fourth quarter.
No store closings or layoffs are planned as part of the transaction. There are currently 300 Belk stores located in 16 Southern states. Plans call for the company to open additional brick-and-mortar stores as well as expand online offerings, according to the Charlotte Business Journal. Founded in 1888 by William Henry Belk in Monroe, N.C., the company is in the third generation of Belk family leadership.
“We are delighted to have found a financial partner that sees what we see in Belk: a 127-year-old brand that remains relevant today with exceptional customer loyalty in small, medium and large cities throughout the South,” says Tim Belk, chairman and CEO of Belk. “We plan to grow Belk by executing our current strategic initiatives and undertaking new growth initiatives together with Sycamore. This transaction is an across-the-board win for our stakeholders.”
Goldman, Sachs & Co. is acting as financial advisor and King & Spalding LLP is acting as legal advisor to Belk. BofA Merrill Lynch is acting as financial advisor and Kirkland & Ellis LLP is acting as legal advisor to Sycamore Partners.
Under the terms of the deal, Belk shareholders will receive $68 a share in cash for each share of Belk common stock they own, according to the company. Belk stock does not trade on major exchanges, instead trading over the counter, and the company reports its quarterly results and other financial details like a publicly traded company.
New York-based Sycamore Partners specializes in consumer and retail investments. The firm’s investment portfolio currently includes Aeropostale, Coldwater Creek, EMP Merchandising, Hot Topic, the Kasper Group, Kurt Geiger, MGF Sourcing, Nine West Holdings, Pathlight Capital, Talbots and Torrid.
— Haisten Willis