Federated's move follows a decision by officials to convert all of the regional chains in the May portfolio, including Hecht's, Meier & Frank, Robinsons-May and others, into Macy's. "We carefully researched customer preferences and studied alternatives before making this decision to incorporate Marshall Field's into the nationwide Macy's brand," says Terry Lundgren, Federated's chairman, president and CEO, in a statement.
By February, there will be 850 Macy's stores across the country, regionally grouped by divisions called Macy's East, Macy's Florida, Macy's Midwest, Macy's North, Macy's Northwest, Macy's South and Macy's West. The consolidation will affect as many as 4,500 employees, though Federated will try to offer them other positions in the company, executives say.
Three stores acquired from May will be converted into Bloomingdale's units, Filene's Chestnut Hill in Newton, MA, and Robinsons-Mays at Fashion Valley Center, in San Diego and South Coast Plaza in Costa Mesa, CA. After the stores are switched next year, Federated will operate 40 Bloomingdale's.
Federated will divest the Filene's department store in Downtown Boston that also served as the headquarters to the Filene's and Kaufmann's chains. The retailer is divesting a total of 76 units next year as a result of the merger.
Federated executives say they have not yet determined what to do with May's 54 upscale Lord & Taylor stores. In March, Federated will start phasing out May's St. Louis corporate headquarters. Most of the 1,700 positions there will be eliminated.
Federated officials have also decided to explore options to divest May's Bridal Group specialty stores, which include includes 245 David's Bridal, 454 After Hours Formalwear and 11 Priscilla of Boston stores in 47 states and Puerto Rico. "While the Bridal Group is a very successful, profitable business with significant growth opportunities, its specialty store model does not fit with Federated's strategy of focusing on department stores and building the Macy's and Bloomingdale's brands," Lundgren said.
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