Target Corporation has completed the sale of its Mervyn's retail subsidiary to an investment consortium including Sun Capital Partners, Inc., Cerberus Capital Management, L.P. and Lubert-Adler and Klaff Partners, L.P.
Mervyn's credit card receivables, totaling approximately $475 million, have been acquired by GE Consumer Finance, making the aggregate consideration of the transaction approximately $1.65 billion in cash.
Mervyn's will continue to operate 257 stores and four distribution centers in 13 states, primarily in the western and southwestern regions of the United States. Based in the San Francisco Bay Area, Mervyn's will function as an independent company.
“Mervyn's has an opportunity to differentiate itself within the mid-level retail market,” said Michael Kalb, a principal with Sun Capital. “We want customers to leave the stores not only completely satisfied, but with money left in their pockets to take care of the other needs their families may have.”
“Mervyn's has made significant strides to elevate its brand by offering its guests an enhanced in-store experience, new merchandise, and exclusive celebrity partnerships,” said Diane Neal, president of Mervyn's. “Our investors bring an expertise and additional resources that will allow us to build on existing successes and take advantage of new opportunities.”
