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KNOXVILLE, TN-Within days of announcing that it willpost a greater loss during the third quarter thanexpected, Goody’s Family Clothing Inc. has accepted anoffer from an affiliate of Sun Capital Partners Inc.to acquire the company.

Sun Capital Partners is best known for its acquisitionof Mervyn’s for $1.2 billion in 2004. The Boca Raton,FL-based investment group joined forces with CerberusCapital Management LP and Lubert-Adler and KlaffPartners LP to take over 257 stores in thirteenstates primarily in the western and southwesternregions of the United States.

The Goody’s Family transaction is valued at about $265million and calls for Sun Capital Partners to pay $8per share cash for the chain. Goody’s Family’schairman and CEO Robert M. Goodfriend and his familyown 42% of the outstanding shares, according to apress release. The deal is not subject to financing ordue diligence, and the closing date has not beendisclosed.

Goody’s Family, which operates 368 stores that offermoderately priced family apparel, posted total salesof $93.5 million for September 2005, a decrease of0.8% from $94.3 million for the same period last year. Comparable store sales for the month declined 5.5% compared to September 2004.

Goodfriend claimed that the chain’s sales wereimpacted negatively by hurricanes Katrina, Ophelia andRita, in addition to unseasonably warm weather. As aresult, the chain expects to report a net loss for thethird quarter 2005 greater than the net loss of 2cents per diluted share reported same period in 2004.

Goody’s Family, which has stores in 20 states,currently has six stores closed because of thehurricanes. Five stores in Louisiana and Mississippiare expected to open before the end of the year, whilethe remaining store in Texas is forecast to open inspring 2006.

Goody’s Family is just one of several retail chains inwhich Sun Capital Partners has invested recently.Earlier this year, the private investment groupacquired Bachrach Clothing, a specialty retailer ofmen’s clothing and Souper Salad, which operates 91 all-you-care-to-eat soup and salad bar family restaurants located in 13 states.

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