Redcats Buys United Retail
Rochelle Park, N.J., Women’s fashion apparel retailer United Retail Group Inc. said Tuesday it would sell itself to Redcats USA, Inc., a subsidiary of Redcats Group, the world’s third-largest catalog and online group in apparel and home products operating in 28 countries, for $193.6 million. Redcats is part of France-based PPR whose holdings include Gucci Group, Yves Saint Laurent, Puma, Bottega Veneta and Stella McCartney.
United Retail, which operates 483 Avenue stores, said the deal has been approved by the boards of directors at both companies and chairman and chief executive Raphael Benaroya has signed an agreement to tender all of his shares to Redcats USA.
The retailer said Benaroya and vice chairman and chief administrative officer George R. Remeta will remain at the company for at least one year after the deal is completed. The company said the acquisition is expected to close by the end of 2007.
In other news, United Retail Group said Tuesday its second-quarter profit fell 56% due to increased promotions and slightly lower same-store sales, but the results still surpassed analysts’ estimates.
Earnings for the period ended Aug. 4 dropped to $2.2 million from $5 million a year ago. Quarterly revenue climbed 1% to $122.3 million vs. $120.9 million in the previous year, meeting Wall Street’s expectations. Same-store sales dipped 1%.