Duluth-based specialty retail chain Maurices is changing hands in a $300 million deal announced Monday.
An affiliate of the London-based private-equity firm, OpCapita LLP, has bought a majority stake in the struggling retailer from Ascena Retail Group, which also owns Ann Taylor, Lane Bryant and Dress Barn.
OpCapita has named former Gap Chief Executive Jeff Kirwan as Maurices' executive chairman, while leaving CEO George Goldfarb in place.
After expenses, Ascena expects to receive $200 million for the Maurices transaction, and will maintain a "significant minority interest."
"Structural changes in our industry have impacted a number of retailers. We have not been immune to these challenges," Ascena CEO David Jaffe said in a statement, adding the proceeds from the Maurices deal will be used to pay down loans or reinvest in the business.
Maurices operates about 940 value-priced younger women's clothing stores nationwide, but has been delivering an "unacceptable level of profitability," Ascena executives said earlier this month.
Jaffe said the company is "planning deliberate actions to generate more profitable growth from those brands and operations in our portfolio that we believe have greater long-term potential."
Ascena said it will continue to provide support for Maurices' supply chain, sourcing, IT and back-office functions using its existing shared business services platform.
Maurices was founded in Duluth in 1931 by E. Maurice Labovitz. Most stores are based in shopping malls and tend to be located in cities outside of major urban areas.
But the retailer is located in every major shopping center in the Twin Cities area, including the Mall of America, Rosedale, Southdale and the Shoppes at Arbor Lake.
Maurices was acquired in 2005 by Dress Barn, which later changed its name to Ascena Retail Group as it acquired more brands.
"We believe there is a real opportunity to increase the profitability of Maurices through hands-on operational improvement," Henry Jackson, the U.S. founder and CEO of OpCapita, said in a statement. "As we establish Maurices as an independent stand-alone company, we welcome the continued support of Ascena through their retained stake and the range of services they will provide."