La-Z-Boy Inc. (NYSE: LZB) will acquire nine La-Z-Boy Furniture Galleries stores and a supporting distribution center in southern Ohio.
Included in the acquisition are four stores in Cincinnati, three in Columbus and two in Dayton, with combined revenue in 2011 of approximately $30 million. The transaction is a result of the planned retirements of two owners and the mutually agreed-upon decision that selling the stores to La-Z-Boy Inc. would be in the best interest of their employees while providing for the greatest stability and continuity of the long-standing southern Ohio business. The nine stores and distribution center will become part of La-Z-Boy's retail operation and will bring the total company-owned store count to 94. The transaction is expected to close in October, subject to customary closing conditions.
"We look forward to adding the southern Ohio market to our company-owned store portfolio," said Chairman, President and Chief Executive Officer Kurt Darrow. "Throughout their tenure as part of the La-Z-Boy Furniture Galleries® system, the owners did an excellent job building the brand and business in their markets over more than 35 years. The enterprise has consistently been a solid performer, and we expect it to be accretive to our earnings. Additionally, with our long-range strategic initiative to service more stores from company-owned distribution centers, the location of the southern Ohio-based facility will fill a void in our current footprint, allowing us to provide distribution center resources for approximately 25 to 30 La-Z-Boy Furniture Galleries® stores over time, including the three new Pittsburgh, Pennsylvania stores we plan to open over the next 12 months.
"Chuck Hausfeld, a 25-year veteran with the southern Ohio operation will become the market sales manager for the area, reporting to Dan King, vice president of La-Z-Boy's retail business. Hausfeld will be responsible for overseeing sales, staffing and training for the nine-store operation, which will operate similarly to La-Z-Boy's company-owned retail markets in terms of roles and responsibilities."
With a solid retail team in place, we anticipate a smooth transition of the business," Darrow added. "Further, we expect it to be seamless to consumers who will continue to enjoy the pleasant, comfortable and professional shopping experience they have come to expect in a La-Z-Boy Furniture Galleries store."
