ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Friday, September 13, 1996 TAG: 9609130143
SECTION: BUSINESS PAGE: A-9 EDITION: METRO
SOURCE: MEGAN SCHNABEL STAFF WRITER
In a move that will keep ownership of the department store chain all in the family, Leggett Stores on Thursday announced its sale to the Charlotte, N.C.-based Belk department store chain.
The future of the 37-store Leggett chain has been the subject of many rumors since early spring. It will be taken over in the next 30 to 60 days by Belk, the company that four Leggett brothers left to start their own chain almost 60 years ago.
In typically conservative Leggett fashion, the privately held company announced the sale in a 21/2-line news release sent out after its central offices in South Boston had closed for the day.
That left no one available to answer questions at either the Belk or Leggett headquarters, and local Leggett employees, who learned of the deal Thursday afternoon, were told not to talk about it.
The announcement said simply that an agreement had been approved "for the sale of the majority of the outstanding shares of stock of Leggett to Belk."
But the announcement probably comes as no surprise to those who know the company.
Rumors about the possible sale of Leggett surfaced after the head of Proffitt's Inc., a Tennessee-based department store chain, was quoted this spring as saying his company would consider buying a company such as Leggett. President Robert Leggett confirmed that his company had received an unsolicited offer from a "major retailer" but would not name the would-be buyer.
But Belk, which operates more than 200 stores in the Southeast, was always the most logical choice, said Kenneth Gassman, a retail analyst with Davenport & Co., a Richmond securities broker.
The Leggett and Belk families first connected in the 1880s, when a Leggett daughter, Hallie Little, married John Montgomery Belk in North Carolina. After the Leggetts split from the Belks in 1927 and opened the first Leggett store in Lynchburg, the Belks continued to own an undisclosed percentage of Leggett stock. Belk and Leggett family members sit on the boards of each other's corporations, and the two companies continued to share buying and accounting services.
Whether Leggett customers will notice a difference in the stores is unclear. Although Belk has not said it will rename the stores, the company's strong reputation in the Southeast makes a name change likely. Southwest Virginia Leggett stores have been remodeling and expanding their stock of higher-end clothing over the past several months. Belk stores typically are more upscale than their Leggett cousins.
"There are a lot of loyal Leggett customers," said Louise Dudley, manager of Valley View Mall in Roanoke and former manager of River Ridge Mall in Lynchburg, both of which include Leggett stores. "But Belk is a well-known retailer as well. I'm optimistic that business will continue as usual."
The sale is, however, likely to change the internal organization of the Leggett stores, Gassman said. Leggett has operated less as a chain than as a loose confederation of quasi-independent stores, each with its own board of directors and shareholders, although the stores share many of the same officers.
"It's going to be good for the Leggett stores," he said.
Staff writer Sandra Brown Kelly contributed to this story.
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