- The Washington Times - Thursday, July 31, 2003

Chico’s FAS Inc. has agreed to buy the White House Inc., a women’s apparel chain that sells only black and white clothing, for $90 million in cash and stock.

Chico’s, which sells colorful clothes in its 415 stores, has no plans to sell its brand at the Glen Burnie, Md.-based company’s stores or vice versa, according to Scott A. Edmonds, Chico’s president and chief operating officer.

Fort Myers, Fla.-based Chico’s will invest in expansion of the White House, which also owns the Black Market, and its national advertising, Mr. Edmonds said. The privately held retailer, which has 103 stores, has the potential to be a 400- to 500-store chain, he said.

Chico’s will pay for the White House with $85.6 million in cash and $4.4 million in its own common stock — or 176,000 shares. The transaction, approved by the boards of both companies, is expected to close in the third quarter of the year.

The agreement comes on the heels of the White House’s plans to go public. Chico’s got a snapshot of the White House’s financial information, its business model and growth plans when it filed regulatory papers with the Securities and Exchange Commission in May in preparation for its initial public offering.

“It is clear to us the White House has a proven store model and we are convinced that there should be a tremendous fit with our organization from a strategic, financial, cultural and operational viewpoint,” Mr. Edmonds said.

The White House was founded in Baltimore in 1985 as a boutique carrying only white clothing for women. Ten years later, the company introduced a concept called Black Market, offering women’s apparel in black.

In 1997, the company combined the concepts under one roof, resulting in the White House | Black Market stores, which carry exclusively black and white clothes.

Sales at the White House stores open at least a year have increased nearly 12 percent per year during the past three years. Total sales last year reached $67 million and the company had a $3.9 million profit, according to SEC filings.

“Chico’s has built a world-class operational platform that the White House should be able to leverage to effectively execute our growth plan,” Richard Sarmiento, the White House’s chairman, president and chief executive officer, said in a statement.

Chico’s reported sales of $531 million for the fiscal year ended Feb. 1. Shares of the company, which trade on the New York Stock Exchange, rose $1.58 yesterday to close at $27.15.

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