Chico's buys firm for $205M

FORT MYERS -- Chico's FAS Inc. closed on its acquisition of Boca Raton-based Boston Proper Inc. today. The deal was announced about one month ago (see below).

Earlier this month, the Business Review explored how Boston Proper's brand image would fit into Chico's portfolio of women's apparel retailers. For that analysis, read "Proper Fit," published Sept. 2.

From Aug. 17:

FORT MYERS — Chico's FAS Inc. acquired Boston Proper Inc., a Boca Raton-based retailer, for $205 million in cash this morning, moments before announcing that it generated more than $43 million in second quarter profits.

Boston Proper will be “immediately accretive” to Chico's' earnings once the transaction closes, the firm says in a statement. The newly acquired company generated $110 million in revenues in its 2010 fiscal year, up more than 10% from the prior year.

Chico's most recent quarterly profit total represents a 47% gain over last year's second quarter, when the firm earned $30 million in net income. Total sales for the quarter were $551 million, up 18% over the year.

After using $205 million in cash to complete the purchase of Boston Proper, Chico's will have roughly $300 million in cash and marketable securities left in its accounts, according to the financial update posted today.

Chico's FAS Inc. (symbol: CHS) fabricates and sells women's clothing and accessories through a network of 1,221 stores. Its stock price is up 52% over the past year, to nearly $13 a share, but down significantly since July, when it temporarily touched values above $16.