Saks Incorporated
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| Saks Incorporated | |
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| Type | Public (NYSE: SKS) |
| Founded | 1999 in Birmingham, Alabama |
| Headquarters | Birmingham, Alabama |
| Industry | Retail |
| Products | Saks Fifth Avenue Off 5th Club Libby Lu |
| Revenue | ▲$5.90 billion USD (2005) |
| Website | www.saksincorporated.com |
Saks Incorporated (NYSE: SKS) is a Fortune 500 operator of department stores in the United States. While currently headquartered in Birmingham, Alabama, the company is in the process of moving to New York City. Saks Incorporated was formerly known as Proffitt's, Inc., prior to the company's 1998 acquisition of Saks Holdings, Inc., the owner of Saks Fifth Avenue. Saks Holdings, Inc. had gone public only in 1996 and was majority owned by a group led by Investcorp, a Bahrain-based investor group. By September 2006, the company had divested all one-time holdings of Proffitt's, Inc. prior to the Saks acquistion.
The company's flagship and namesake stores operate under the name of Saks Fifth Avenue. It also operates several outlet stores under the Off 5th nameplate, and the e-commerce website Saks.com. The ventures comprise the Saks Fifth Avenue Enterprises division of the company. The company also currently operates 95 Club Libby Lu specialty shops targeted to girls between the ages of 6-12 years old. [1]
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[edit] History
[edit] Proffitt's Inc.
Saks Incorporated began as Proffitt's Inc., with just five Proffitt’s stores in metropolitan Knoxville, Tennessee. From 1994 to 1998, the company added McRae's, Younkers, Parisian, Herberger's, Carson Pirie Scott, Boston Store, and Bergner's chains, as well as 32 additional stores from Loveman's, Hess's, Parks-Belk, and Brody’s, which were converted into existing store nameplates.
In September 1998, Proffitt’s Inc. and Saks Holdings Inc. completed a merger transaction where Saks Fifth Avenue and Off 5th outlet stores became a division of Proffitt’s, Inc. As a result, the corporate name of Proffitt’s, Inc. was changed to Saks Incorporated. The former Saks Holdings properties eventually would become the Saks Fifth Avenue Enterprises division of the renamed corporation.
Since the purchase of Saks Fifth Avenue by Proffitt's Inc, the company stock has taken a beating from the original opening price when Saks Fifth Avenue became a public company. The new Saks Incorporated (formerly Proffit's inc) has had one change in business direction after another without the appearance of anyone in control or guiding the corporation. Saks Inc. has sold off all other retailers with the exception of Club Libby Lu, a small acquisition based in Chicago, IL. Saks Inc. still maintains a center of sorts in Jackson MS without explanation. The decisions of Saks Inc. whose only remaining business is Saks Fifth Avenue Enterprises (SFAE), continue to befuddle executives at SFAE and share holders alike as decisions appear to be in the interest of the few left, but 'in charge' Saks Inc. executives, their bonuses, and pension plans rather than that of the Company or Share Holders.
[edit] Sales
By 2005, Saks Incorporated began to seek a narrower focus towards the luxury-oriented retail synonymous with its Saks Fifth Avenue stores. The decision resulted in a July 2005 sale of its combined 47 Proffitt's and McRae's stores to Belk for approximately $622 million.
On October 31 that same year, Saks announced that it was selling the 142 stores within its Northern Department Store Group, including Carson Pirie Scott, Bergner's, Younkers, Herberger's, and Boston Store) to Bon-Ton Stores, Inc., for $1.1 billion; the transaction was complete as of March 6, 2006.[2]
On August 2, 2006, Saks Incorporated announced that it had agreed to sell its 38 Parisian stores, along with two regional distribution centers, to Belk, which rebranded them under their own name in the third quarter of 2007. Saks has also announced plans to relocate their headquarters from Birmingham to New York.
Other reports have indicated interest in selling off the Club Libby Lu stores. The company's activity within the last 12 months is seemingly oriented toward the return of Saks Fifth Avenue as an independently-operated brand for the first time in more than 30 years. Some industry experts have also speculated that the activity positions a streamlined Saks Incorporated itself for buyout at a later point.[citation needed]
