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May walks the aisle
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July 3, 2000: 1:32 p.m. ET
Department store chain to acquire David's Bridal in $436M deal
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NEW YORK (CNNfn) - May Department Stores is getting hitched.
The St. Louis-based owner of Lord & Taylor and other chains said Monday it plans to acquire David's Bridal Inc., the largest U.S. bridal gown retailer, for $20 a share, or $436 million.
The acquisition gives May a strong foothold in the $4 billion a year bridal business.
May said acquiring David's Bridal (DABR: Research, Estimates) will give a boost to the company's new Internet wedding registry business, WeddingNetwork.com, expected to launch by the end of July.
 The company also said the David's acquisition will enhance its bridal registry services and sales of wedding-related apparel and accessories.
May's offer for Conshohocken, Pa.-based David's Bridal, which posted $175 million in sales in 1999, is subject to regulatory and shareholder approval.
"David's Bridal is a very exciting acquisition and a highly strategic complement to our core department store business," May's President and CEO Gene Kahn said. "There are tremendous synergies between the David's stores and the wedding registry business in May's department store divisions."
Analysts approved the match, noting that May is a financially strong company that has expressed interest in the past in getting into some sort of specialty retail business.
"It's a good industry. It's growing, and it has been growing for a long, long time, but I think the May company is particularly interested in getting access to the bridal business," said Kurt Barnard, president of Barnard's Retail Trend Report in Montclair, N.J.
And David's has become the largest bridal gown retailer because of its formula of stocking its stores with gowns ready to wear off the rack. The company also sells everything from bridesmaid's dresses and accessories to dresses for the flower girl.
Brides often have to wait weeks at other retailers for their custom-made dresses to arrive at the store before they can even try them on, said Sally Wallick, an analyst with Legg Mason.
"The number of weddings has been fairly stable over time, but the story with David's is they have a better mousetrap in my opinion," Wallick said. "...It makes the shopping experience much easier. So what they've done is they have created a format that is very consumer friendly and solves a lot of problems for the bride-to-be, and they've been able to roll this out. And as a result, they've been gaining market share."
Wallick also added that as young brides come to David's, May will have access to valuable consumer information about that woman, a potential customer for the rest of her life.
Other retailers are sure to follow May down the aisle, looking to boost their wedding offerings, but David's has no close competitors, Barnard said.
David's Bridal will operate as a division of May if the acquisition is approved, with Bob Huth remaining president and CEO, officials said. No jobs are expected to be cut.
May Department Stores reported 1999 sales of $13.9 billion at its 422 stores nationwide. It operates stores under the Hecht's, Strawbridge's, Filene's, Foley's, Robinsons-May, Kaufmann's, Famous-Barr, L.S. Ayres, Jones Store, Meier & Frank and ZCMI names.
David's Bridal, which operates 110 stores nationwide, markets primarily to first-time brides between 18 and 34 years of age.
"...Merging with May Company is a tremendous partnership opportunity. The synergies between our two organizations are substantial," Huth said.
Shares of May (MAY: Research, Estimates) notched up 1/2 to 24-1/2 after the announcement Monday. David's shares closed up 8-3/16 at 19-3/4 in the abbreviated trading day. 
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