House of Fabrics Acquires 18 of 23 Home Silk Stores
Expanding in Southern California, Sherman Oaks-based House of Fabrics said it has bought 18 stores from the 23-store Home Silk Shop chain for an undisclosed amount of cash.
The deal with the much smaller Home Silk Shop chain comes just a month after merger talks between the two companies collapsed after House of Fabrics issued a disappointing earnings report. House of Fabrics is America’s largest retailer of home sewing fabrics, with 760 stores in 47 states.
The 18 units, all in Southern California except for one in Arizona, will be operated under the House of Fabrics name. Four other Home Silk units will be closed, and the company will retain one store, its flagship outlet on La Cienega Boulevard at 3rd Street in Los Angeles, which it will continue to operate as Home Silk.
The acquired stores range in size from 8,000 to 22,000 square feet, which is in keeping with House of Fabrics’ plans to open larger stores.
In the latest fiscal year, ended June 30, 1984, the 46-year-old, privately held Home Silk chain posted revenue of $14.5 million.
“The acquisition will expand our superstore base and add even greater strength to our already strong position in the market,” said House of Fabrics Chairman David I. Sofro, noting that his company already has 61 stores in Southern California. “We plan to add sewing machine and craft departments to these stores in order to further enhance their performance.”
For the fiscal year ended Jan. 31, House of Fabrics earned $11.3 million on sales of $278.3 million, up from earnings of $9.7 million on sales of $239.6 million in the previous fiscal year.