US: BJ's Wholesale Club to close five stores
BJ's Wholesale Club is closing five stores
US wholesale retailer BJ's Wholesale Club is to close five stores as part of restructuring plans to drive shareholder value amid talk of investors unhappy at the company's performance.
BJ's will close three outlets in Atlanta, one in Florida and one in North Carolina by the end of the month. The retailer said the stores were losing a combined US$4-5m a year.
CEO Laura Sen said BJ's had been working on plans to "optimise our performance and build for the future" for months.
"The five clubs to be closed have historically underperformed and, after careful consideration, we concluded that improvement of their operating results was unlikely. The savings associated with the actions we are announcing today will be invested in new clubs, remodels, and information technology, all of which are vital to our competitiveness, future growth and profitability," Sen said.
The wholesaler also plans to restructure its head office and some of its field operations. The moves will lead to job losses, although BJ's did not specify how many. Reports suggest around 100 staff at the retailer's HQ and the affected field operations will leave.
Separately, BJ's announced that CFO Frank Forward and executive vice president of club operations Tom Gallagher were to leave the business on 29 January. BJ said Forward's departure had been under discussion since 2007, while Gallagher had decided to quit for health reasons.
Bob Eddy, BJ's director of finance, will become CFO. Cornel Catuna, the retailer's senior vice president of field operations, will replace Gallagher.
BJ's shares were down 1.5% at $46.29 at 12:41 ET today. Private-equity fund Leonard Green has been reportedly courting the retailer since July after buying a 9.5% stake in the business.
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