Wednesday, March 15, 2017

BJ's may be looking to sell or go public

A report in the Wall Street Journal last month stated that the private equity firms that own BJ's Wholesale Club could either be trying to sell the company or planning for an IPO.

Leonard Green and Partners and CVC Capital Partners acquired BJ's in 2011 for about $2.8 billion. At the time, it was reported that Walmart made an offer for BJ's but was rejected.

An analyst at Kantar Retail noted that although more and more BJ's shoppers have been cross-shopping on Amazon and limited-assortment discounters are eroding the uniqueness of the warehouse club's value proposition, BJ's has shown signs of improvement since CEO Chris Baldwin took over last February.

Baldwin has focused on five key pillars: smart saving families; improving value perception; driving member engagement and retention; revitalizing the general merchandise assortment; and increasing its response speed by improving processes.

BJ's currently operates 213 clubs. Although analysts think Costco and Sam's Club could be curious about acquiring BJ's, they believe it's unlikely either company would make such a large investment in physical stores.

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