Jonathan Ramsden will exit Abercrombie, without a CEO since 2014, in June.
The $200 million deal jump starts the return to online retailing for TJX.
The TJX Companies Inc., which operates such off-price apparel and home goods chains as T.J. Maxx, Marshalls and HomeGoods, said earlier this year it planned to return to online retailing. The company took a big step in that direction today by acquiring Sierra Trading Post Inc., which sells discount apparel primarily online and through catalogs.
TJX says it paid $200 million in cash for Sierra. The deal includes Sierra’s headquarters, fulfillment center and photography studios in Cheyenne, WY, its call centers in Cheyenne and Cody, WY, and its four outlet stores in Idaho, Nevada and Wyoming.
“We continue to plan on launching e-commerce sites for TJX brands and this acquisition adds immediate scale, capabilities and infrastructure in e-commerce, which we can leverage in that regard,” says TJX CEO Carol Meyrowitz. “We believe we will be able to build upon this platform as we continue to develop our e-commerce strategy. Further, we are confident that TJX can help grow the Sierra business profitably through our buying scale, marketing and our other capabilities."
Meyrowitz told Wall Street analysts in February that the company planned to return to selling online, although she did not say when or provide many details. TJX shuttered its U.S. e-commerce site, TJMaxxHomeGoods.com, in 2005 after more than a year of operation that the company said produced $15 million in operating losses.
Sierra Trading Post generates sales of more than $200 million a year, is profitable and employs about 700 people, TJX says. 2011 online sales of Sierra Trading Post, No. 94 in the Internet Retailer Top 500 Guide, amounted to $236 million, up 7.5% from 2010, according to an Internet Retailer estimate.
"As an off-price online retailer, Sierra Trading Post shares many characteristics with TJX,” Meyrowitz says. “As we do, Sierra offers branded apparel, footwear and home furnishings at great values, has a very loyal customer base, strong vendor relationships and operates with a low cost structure. We also see Sierra's management team, with their deep Internet retailing experience, as a complement to the strong e-commerce team we have built within TJX.”
TJX operates 1,039 T.J. Maxx, 912 Marshalls and 417 HomeGoods stores in the United States; 222 Winners, 88 HomeSense and 14 Marshalls stores in Canada; and 344 T.K. Maxx and 24 HomeSense stores in Europe.