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Article Excerpt
-Executes Long-Term Services Agreement For Private Label Credit Card Receivables Program -Company Schedules Second Quarter Sales And Earnings Conference Call For August 26, 2009
BENSALEM, Pa., Aug. 13 /PRNewswire-FirstCall/ -- Charming Shoppes, Inc. , a leading multi-brand apparel retailer specializing in women's plus apparel, and Alliance Data Systems Corporation , a leading provider of loyalty and marketing solutions derived from transaction-rich data, today announced an agreement for the sale of Charming Shoppes' (the "Company") credit card receivables program to Alliance Data Systems Corporation ("Alliance Data"). Charming Shoppes and Alliance Data have also entered into a ten-year operating agreement for the servicing of Charming Shoppes' private label credit card receivables program. The Company expects the transaction to close before the end of the year, subject to attaining certain customary regulatory approvals.
Charming Shoppes expects to receive net cash proceeds of approximately $110 million related to the transaction. The transaction consists of the sale of Charming Shoppes' private label credit card portfolio, along with certain other assets and liabilities that are required to support these card programs, including Charming Shoppes' consolidated balance sheet asset "Investment in Asset-Backed Securities." Gross proceeds from the transaction are estimated at $140 million. Approximately $30 million will be utilized to fund the termination of contractual obligations related to the transaction and exit costs.
Charming Shoppes' Investment in Asset-Backed Securities are held on its consolidated balance sheet. Its off-balance sheet Series 2004-1 and Series 2007-1 securitization funding facilities are currently held in the Charming Shoppes Master Trust. Alliance Data will assume the operation of this Trust and all funding responsibility in support of...
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