Children's Place to buy Gymboree, Gap absorbs Janie and Jack

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The brick-and-mortar retail shuffle continues as more acquisitions are on their way for a collection of children's clothing companies, including Gymboree, which sold to competitor Children's Place, while Gap Inc. intends to acquire Janie and Jack, the Wall Street Journal reports.

Details: Both transactions will still need to be verified in bankruptcy court. Children's Place is paying $76 million for the rights to Gymboree, its Crazy 8 brand and Singapore-based Zeavion Holding. Meanwhile, Gap's eventful week continues, closing out with the $35 million purchase of Janie and Jack and a secondary acquisition of the chain's inventory out of liquidation.

Go deeper: Retail spending sees biggest monthly drop since 2009

Payless was another step in private equity's retail apocalypse

In this image, the orange and white storefront sign for Payless ShoeSource is visible against a beige concrete wall.
Photo: Paul Hennessy/NurPhoto via Getty Images

Private equity's retail apocalypse hit another miserable milestone yesterday, with Payless ShoeSource refiling for Chapter 11 bankruptcy. The shoe store chain also plans to liquidate all 2,500 of its North American locations, costing around 16,000 people their jobs.

The bottom line: Physical retail is under severe stress, regardless of ownership structure, but private equity is almost always buying into mature industries that are prone to disruption. Engaging in large dividend recaps only makes the margin for error that much smaller, and the likelihood for failure that much larger.

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