Mccrory's Taking Over Murphy's

Posted: August 08, 1989

McCrory Stores Corp., the five-and-dime operator based in York, Pa., is taking over G.C. Murphy Co., one of its few remaining competitors in the

shrinking variety-store business.

The $80 million deal was announced yesterday by McCrory's and Ames Department Stores Co., the Connecticut-based retailer that is selling Murphy's.

Murphy's, established in 1906, has its headquarters in McKeesport, Pa. It operates 130 variety stores, roughly one-third of them in Pennsylvania. The deal also includes a chain of 25 small discount stores that operates under the name Bargain World.

"These stores are a natural marriage with McCrory's," said J. Philip Lux, McCrory's chairman and chief executive officer.

McCrory's has swallowed up a number of the venerable names in the five-and- dime business. It owns J.C. Newberry, T.G.& Y., McLellan, H.L. Green, Silver, Elmore, Britts and Kittinger. Two years ago, it bought the last of the Kresge variety stores from K mart Corp.

The five-and-dime store business "is something that few of us are in these days," Lux said. "Other than a few small regional chains out there, we are left with Ben Franklin (a franchised chain), Woolworth and ourselves."

The Murphy's acquisition, Lux added, "will put us ahead of Woolworth in terms of sales and number of variety stores in the United States."

While F.W. Woolworth Co. is a larger company that McCrory's, it has not been expanding its five-and-dime stores in recent years, concentrating instead on shoe stores and other ventures.

McCrory's is a subsidiary of E-II Holdings Inc., a privately held firm controlled by New York investor Meshulam Riklis.

It now operates about 1,300 stores with annual sales estimated at $1.5 billion to $1.8 billion. McCrory's is opening 80 stores and is converting about 60 stores in the recently acquired Odd Lots chain to five-and-dime stores.

The stores being sold by Ames had sales of $175 million in the most recent fiscal year. The sale should be completed in 45 days.

Ames, which is based in Rocky Hill, Conn., has owned Murphy's since 1985. It acquired the chain of Zayre discount stores last year.

Bill Roberts, a spokesman for the company, said that the variety stores were profitable, but did not fit into Ames' long-term plans to concentrate on the discount-store format.

comments powered by Disqus
|
|
|
|
|