Sandpoint retailer Coldwater Creek plans major expansion – Retailer selling stock to finance at least 400 new stores

Coldwater Creek Inc. is selling stock to finance an ambitious expansion of its women’s clothing stores.

Becky Kramer
Staff writer Spokesman Review

The Sandpoint retailer expects to open 400 to 500 new stores in the next decade, giving the company a national presence. Coldwater Creek will sell up to 2.5 million new shares of stock, which will raise $33 million to $37 million to fund the next expansion phase.

"Coldwater Creek has been seen as a very attractive new retail concept. We’ve sensed that there is an opportunity for us to expand across the country," said company spokesman Dave Gunter.

Retail stores represent the youngest and fastest-growing portion of Coldwater Creek’s $520 million in annual sales. The company started out as a catalog retailer in Sandpoint in 1984. It later added an Internet site, and in 2000, the company launched plans for a line of women’s clothing stores.

Coldwater Creek currently operates 63 stores, mainly in larger cities. The stores generated about 33 percent of the company’s sales during the past 12 months.

When many traditional retailers were making their first forays into online sales, Coldwater Creek was moving the other way.

The company’s strategy is to open retail stores in areas where it already has high concentrations of catalog and Internet customers. Most women’s clothing is still purchased in retail stores, because women like to try on garments before they buy them.

Coldwater Creek planned to open 30 stores next year, but has boosted the number to 40 or 50. Gunter said interest from developers who wanted Coldwater Creek stores in their retail developments was part of the reason for the increase.

"The brand is very well known and very well received, and we are still in the early part of our growth curve," he said.

The stock sale is Coldwater Creek’s first large offering since the company went public in 1997.

Coldwater Creek founders Dennis and Ann Pence will continue to own a controlling interest in the company, though the proportion of shares they own will drop from about 50 percent to 42 percent.

After the offering, the company will have more than 24 million shares of common stock. Coldwater Creek’s stock closed at $12.85 per share Friday, down 75 cents.

http://www.spokesmanreview.com/news-story.asp?date=120603&ID=s1451497&cat=section.business