The Dress Barn, Inc. announced today that the company completed its expected holding company reorganization on January 1, 2011. Ascena Retail Group, a new Delaware corporation, has replaced Dress Barn as the publicly held corporation and will begin trading immediately under the ticker “ASNA.” The reorganization was approved at Dress Barn’s annual shareholders meeting on December 17, 2010.
This move should not affect Dress Barn’s position in the portfolio because as a result of the reorganization, shareholders of Dress Barn automatically become stockholders of Ascena on a one-for-one basis. We will be holding the same number of Ascena shares and have the same ownership percentage after the reorganization as held of Dress Barn prior to the reorganization.
According to the company's press release, “Incorporating the new holding company in Delaware will allow the company to take advantage of the flexibility, predictability and responsiveness that Delaware corporate law provides.” The three core brands: dressbarn, maurices, and Justice, have become wholly-owned subsidiaries of Ascena and will continue operations as is under the new structure. No changes have been made to directors or executive officers.
Given the successful acquisitions of maurices and Justice within the last five years, the reorganization confirms a strategic shift in direction for the company. Prior to the purchase of maurices in 2005, Dressbarn was centered around a single brand but has begun to develop a more portfolio-style brand approach. Management has proven their ability to integrate these acquired brands, and the transition to a portfolio driven holding company suggests further acquisitions are expected in the future.
-Ian
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