BJ’s Wholesale placed on sales block

Sale confirmation and positive year-end results drive stock increases of more than $5 in early morning trading

WESTBOROUGH, Mass. — After months of speculation, BJ's Wholesale Club early Thursday morning confirmed the company has decided to explore and evaluate strategic alternatives. Coupled with that announcement was a positive sales story for the year.

BJ’s stock was up by more than $5 to $48.66 in early morning trading on Thursday. Over the last year, the company’s shares have risen about 30%, fueled in part by takeover speculation. Rumors that BJ’s may be a takeover target have circulated since the summer, when Leonard Green & Partners bought a 9.5% stake.

An independent committee of BJ’s has engaged Morgan Stanley as its financial adviser to assist in this process.

BJ’s also reported positive January sales results despite the number of cold-weather storms that recently have swept the country. Sales were up 6.5% to $779.8 million. Comparable sales also were up 2.7%, including a contribution from sales of gasoline of 2.4%.

Excluding the impact of gasoline, merchandise comparable-club sales increased by approximately 0.3%. Severe snowstorms affecting the Northeast and mid-Atlantic regions had a negative impact on merchandise comparable-club sales of approximately 2.5%, the club retailer estimated.

Total sales for the wholesaler were up 8.3% to $10.6 billion for the year ended Jan. 29, with comparable sales up by 4.4%, including a contribution from sales of gasoline of 2%. Excluding gasoline, merchandise comparable-club sales increased 2.4%. BJ's operates 189 warehouse clubs in 15 states.

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