June 12, 2002, 12:00 AM

New life for Fingerhut: Federated agrees to sell

Federated Department Stores Inc. reports it has reached a definitive agreement with FAC Acquisitions LLC for the purchase of Federated’s Fingerhut subsidiary.

Federated Department Stores Inc. reports it has reached a definitive agreement with FAC Acquisitions LLC for the purchase of Federated’s Fingerhut subsidiary. Under the agreement, FAC Acquisitions, headed by Theodore Deikel, former CEO of Fingerhut, and Thomas J. Petters, owner of a wholesale business, will buy the web site, inventory, two fulfillment centers, corporate headquarters and a data center.

If the sale is consummated, it will be the end of a bumpy ride as Federated tried to shed Fingerhut. It announced in January it would shut down Fingerhut, walking away from a $1.7 billion investment that Federated made in purchasing Fingerhut in 1999 to get Fingerhut’s web expertise. Less than a month after it announced the shutdown, Federated said it was negotiating the sale of Fingerhut to Business Development Group Acquisitions Inc. Those negotiations fell apart in early May and it looked like Fingerhut’s demise was imminent. Two weeks later, FAC Acquisitions surfaced as a buyer.

"We are pleased that we have been able to negotiate this definitive agreement with Tom Petters and Ted Deikel for the sale of these Fingerhut assets, and that the buyers have indicated a desire to rehire a number of Fingerhut employees as part of their future business plans," said Ronald W. Tysoe, Federated`s vice chairman. "We anticipate being able to finalize this sale in the near future."

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