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MINNEAPOLIS-Retail experts were surprised Target Corp. was able to sell Mervyn’s in its entirety as an operating retailer, given it has struggled for years. A private investor consortium consisting of Sun Capital Partners, Cerberus Capital Management and Lubert-Adler and Klaff and Partners recently agreed to pay $1.65 billion for 257 Mervyn’s stores and four distribution centers.

Officials at Sun Capital, the Florida-based investment firm that bought Musicland a year ago from Best Buy Co., insist they will operate it as an independent retail chain. A recent United Properties commercial real estate report quoted “market observers” as saying, “The struggling Mervyn’s chain will not likely be sold as a continuing business.” The observers expected an acquisition would likely be a retail play for redevelopment or reuse by other big boxes like Kohl’s or Best Buy.

But Target did not want to take the piecemeal approach, and had as a key goal to sell it essentially whole, says Target spokeswoman Carolyn Brookter. Still, it remains an open question how Mervyn’s will fare under its new owners, says Eric Beder, a securities analyst at J.B. Hanauer & Co. Beder wonders how many stores the new owners will close or what they will eventually do with the assets.

“They are financial buyers,” Beder says. “In the end, they need a financial event.” Such events could include a public stock offering, a sale of the chain or a liquidation of the assets.

Mervyn’s credit card receivables were sold to GE Consumer Finance for $475 million, according to Target.

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