Lundgren sharpens Macy’s, Bloomingdale’s focus.
NEW YORK — Federated Department Stores said Thursday that it has agreed to sell its Lord & Taylor division to NRDC Equity Partners for $1.195 billion in cash.
The transaction confirms a report that appeared in Thursday’s Wall Street Journal.
L&T includes 48 stores, including its Fifth Avenue flagship in New York, and was acquired as part of Federated’s 2005 purchase of May Department Stores. L&T became part of May Co. when May acquired Associated Dry Goods in 1986. It was founded 180 years ago.
NRDC is a partnership between principals of Apollo Real Estate Advisors LP and National Realty & Development Corp.
Federated intends to focus its efforts on the cultivation and expansion of its Macy’s and Bloomingdale’s brands. However, Terry Lundgren, chairman, president and chief executive of Federated, described L&T as “a well-known niche specialty retailer with a great name, many outstanding locations and an experienced management team. We are pleased that NRDC Equity Partners sees the opportunity in operating Lord & Taylor as an ongoing specialty department store and values the quality of its management team.”
That team has been headed by CEO Jane Elfers since 2000. Three years ago, L&T undertook a substantial downsizing in order to focus its business on its most profitable units.
Pending regulatory approvals, the sale is expected to close during the third quarter.