The $210 m cash deal will be complete by spring and the first earnings Macy’s realizes from the acquisition will be reflected in fiscal 2016.
There are no plans for a Macy’s spa to open anytime soon. “Spa services are integral to Bluemercury’s specialty stores, which are the top growth priority to start. We then will start looking at what might make sense for Macy’s stores,” company spokesman, Jim Sluzewski told the New York Times DealBook.
For the time being, the acquisition allows Macy’s to strengthen its existing position in middle-market beauty. “Beauty is a core signature business for Macy’s and Bloomingdale’s and a continued platform for our company’s profitable sales growth,” said Terry J. Lundgren, Macy’s chairman and chief executive officer in a media release announcing the deal.
“With Bluemercury, our company can access a new channel to reach additional customers, add new dimensions to our product offering and apply our expertise in omnichannel retailing.”
Bluemercury will open additional brick-and-mortar shops, even more than the company would have established under its previous partnership with equity investors The Invus Group.
“With the full weight of Macy’s resources, we will be able to accelerate our store penetration across the United States, bringing our specialty store format to urban and suburban markets throughout the country,” said Barry Beck, Bluemercury’s co-founder and chief operating officer.
Macy’s is restructuring company leadership to focus on omnichannel retail innovations and strategy not just for Bluemercury but companywide.
“These moves, in conjunction with restructured omnichannel capabilities announced on Jan. 8, 2015, fully align the company’s management and organization in key functions – such as merchandising, merchandise planning, marketing and technology – to drive internal growth,” according to the company.
Among the changes in leadership: Timothy G. Baxter moves into the chief merchandising officer role, Molly Langenstein takes over as the chief private brands officer, Patti H. Ongman will step up as chief merchandise planning officer, and Martine Reardon’s position as chief marketing officer expands to include responsibility for the company’s omnichannel market presence and strategy.
It’s no surprise that the company’s recent acquisition activity and senior team realignment are intended to better the bottom line. “We are very pleased with our fourth quarter performance, which represents a strengthening trend from the third quarter and spring season,” said Lundgren.
“In particular, we believe that we have an excellent foundation on which to continue to grow sales and earnings, as described in last month’s moves to restructure our merchandising and marketing organizations, and today’s announcements on new senior executive appointments and the agreement to acquire Bluemercury, Inc.”