Federated Department Stores
will sell its Lord & Taylor division by year-end.
The decision by the Cincinnati department store giant ends months of speculation about the fate of Lord & Taylor, which operates a flagship Fifth Avenue store in midtown Manhattan as well as 54 other stores. Last year Federated acquired rival May and moved to consolidate most of its owned and acquired store chains, such as Filene's, Marshall Field's and Kaufmann's, under the more nationally prominent Macy's banner.
"After a thorough review, we have concluded that Lord & Taylor does not fit with our strategic focus for building the Macy's and Bloomingdale's national brands," said CEO Terry J. Lundgren. "However, Lord & Taylor is a niche specialty retailer with a great name, many outstanding locations, an experienced management team and a strong customer following that makes it a desirable business."
Federated will now account for Lord & Taylor as a discontinued operation in its monthly sales and quarterly earnings reports. This is expected to reduce fourth-quarter 2005 earnings from continuing operations by 10 cents per share. The division's 2004 sales were $1.57 billion.
On Thursday, Federated shares rose $1.32 to $72.95.