The Ascena Retail Group is venturing into the plus-size female market by acquiring Charming Shoppes Inc., parent company of Lane Bryant, for about $890 million.
The purchase will allow Ascena, owner of Dressbarn and teen clothier Justice, to jump into the growing market for bigger-sized women's apparel. Charming also owns the Catherines Plus Size and Fashion Bug brands.
The Suffern, N.Y.-based Ascena will buy Charming for $7.35 a share, a 25% premium on Tuesday's closing price. The deal was approved by the boards of both companies and is expected to close by the second quarter of this year.
Ascena said it would use cash and existing financing commitments to fund the purchase. After the deal closes, Charming will become a subsidiary of Ascena.