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Caban is closing:
Ralph Lauren pulls plug on sale of Caban
Landlords' desire to reclaim space a factor
MARINA STRAUSS
RETAILING REPORTER; With a file from Shirley Won
Polo Ralph Lauren Corp. will shutter its seven Caban home decor stores across Canada after its two major landlords helped dash hopes for any deal to sell the chain because they wanted to get back their coveted store space.
Grocery behemoth Loblaw Cos. Ltd., which houses three Caban stores next to its supermarkets, wants the prime retail space to showcase its own home fashions, industry sources said. It could also rent the stores to a non-competing retailer, they said.
Cadillac Fairview Corp. wants a more successful retailer for two more outlets that are occupied by Caban at top malls in Toronto and Calgary, the sources said.
Ralph Lauren spokeswoman Nancy Murray confirmed the chain will close by Aug. 31, but would not comment beyond saying the company wants to focus on its "core apparel and accessories business."
Big landlords can have significant clout in deals to sell a merchant, even holding up a transaction if they don't approve of the potential buyer for a sublease. Faced with a scarcity of star locations, they need to ensure that they get the best tenants for their stores.
For Loblaw, the bid to control its real estate is paramount. It is focused on expanding its non-grocery merchandise in its competitive battle with titan Wal-Mart Canada Corp. The grocer is looking for every way to shore up its operations.
The turn of events has an ironic twist to it. Joe Mimran, who came up with the Caban concept when he headed hip fashion retailer Club Monaco, is now the chief architect of Loblaw's private label home furnishings and fashion lines.
Industry insiders believe that Loblaw wants to give Mr. Mimran's goods more prominence by placing them in the spaces now occupied by Caban stores. One way or another, Loblaw wants the space to be more productive -- and not distract from its own merchandise.
The landlords' position made it more difficult for would-be buyer Stephen Granovsky, a Toronto retail consultant and investor, to make headway in cutting a deal, the sources said.
They said that Mr. Granovsky's financial partner, William Taggart of U.S. private equity firm York Management Services Inc., has backed away from a Caban transaction.
"They couldn't make it work," a source said. Mr. Granovsky would not comment yesterday. And Mr. Taggart did not return recent calls. Loblaw and Cadillac Fairview officials would not comment.
Mr. Granovsky, president of Karabus Management, has done extensive retail consulting work in North America. He is also among the new investors in discounter Saan Stores, which emerged from bankruptcy protection last year.
York Management of New Jersey owns the Northern Reflections and Regal Greetings and Gifts chains, among others, and was an investor in Kmart Canada Co. before it was sold to Hudson's Bay Co. in 1998.
Caban made a big splash when it was launched in 2000 as a stylish home fashion chain under the creative inspiration of Mr. Mimran. But it later lost its focus after he was ousted from Ralph Lauren that same year, shortly after the New York fashion retailer had acquired Mr. Mimran's Club Monaco.
Ralph Lauren pulls plug on sale of Caban
Landlords' desire to reclaim space a factor
MARINA STRAUSS
RETAILING REPORTER; With a file from Shirley Won
Polo Ralph Lauren Corp. will shutter its seven Caban home decor stores across Canada after its two major landlords helped dash hopes for any deal to sell the chain because they wanted to get back their coveted store space.
Grocery behemoth Loblaw Cos. Ltd., which houses three Caban stores next to its supermarkets, wants the prime retail space to showcase its own home fashions, industry sources said. It could also rent the stores to a non-competing retailer, they said.
Cadillac Fairview Corp. wants a more successful retailer for two more outlets that are occupied by Caban at top malls in Toronto and Calgary, the sources said.
Ralph Lauren spokeswoman Nancy Murray confirmed the chain will close by Aug. 31, but would not comment beyond saying the company wants to focus on its "core apparel and accessories business."
Big landlords can have significant clout in deals to sell a merchant, even holding up a transaction if they don't approve of the potential buyer for a sublease. Faced with a scarcity of star locations, they need to ensure that they get the best tenants for their stores.
For Loblaw, the bid to control its real estate is paramount. It is focused on expanding its non-grocery merchandise in its competitive battle with titan Wal-Mart Canada Corp. The grocer is looking for every way to shore up its operations.
The turn of events has an ironic twist to it. Joe Mimran, who came up with the Caban concept when he headed hip fashion retailer Club Monaco, is now the chief architect of Loblaw's private label home furnishings and fashion lines.
Industry insiders believe that Loblaw wants to give Mr. Mimran's goods more prominence by placing them in the spaces now occupied by Caban stores. One way or another, Loblaw wants the space to be more productive -- and not distract from its own merchandise.
The landlords' position made it more difficult for would-be buyer Stephen Granovsky, a Toronto retail consultant and investor, to make headway in cutting a deal, the sources said.
They said that Mr. Granovsky's financial partner, William Taggart of U.S. private equity firm York Management Services Inc., has backed away from a Caban transaction.
"They couldn't make it work," a source said. Mr. Granovsky would not comment yesterday. And Mr. Taggart did not return recent calls. Loblaw and Cadillac Fairview officials would not comment.
Mr. Granovsky, president of Karabus Management, has done extensive retail consulting work in North America. He is also among the new investors in discounter Saan Stores, which emerged from bankruptcy protection last year.
York Management of New Jersey owns the Northern Reflections and Regal Greetings and Gifts chains, among others, and was an investor in Kmart Canada Co. before it was sold to Hudson's Bay Co. in 1998.
Caban made a big splash when it was launched in 2000 as a stylish home fashion chain under the creative inspiration of Mr. Mimran. But it later lost its focus after he was ousted from Ralph Lauren that same year, shortly after the New York fashion retailer had acquired Mr. Mimran's Club Monaco.