Whitehall Buys 78 Friedman's Stores

By Rob Bates -- JCK Online, 6/1/2008 2:00:00 AM

Whitehall Jewelers recently acquired the assets and leases of 78 stores from Friedman's and its subsidiary Crescent Jewelers for approximately $14.3 million. In April, Friedman's announced it would close its remaining stores. Whitehall will operate the stores under the names Whitehall or Lundstrom.

The deal “considerably increases the number of jewelry stores that we will operate and will increase our market share,” Edward Dayoob, chairman and chief executive officer of Whitehall, said in a statement.

The purchase price was equal to 63 per-cent of the aggregate cost value of the inventory.

Whitehall had been the high bidder to buy the entire chain, but Friedman's eventually said it was “not satisfied” with that bid, leading to the decision to close its stores.

Whitehall is financing the purchase price for the acquisition through borrowing under its revolving credit facility, the company said. Still, the purchase raised eyebrows. Last December, Whitehall said it was “seeking financing” to meet its “working capital … and capital expenditure” needs for the rest of the year. It eventually arranged a credit agreement with PWJ Lending.

Whitehall officials did not answer repeated calls from JCK for comment.

The company operates approximately 297 stores in regional and super-regional malls under the names Whitehall and Lundstrom.