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financial

Fast Retailing Plan Includes $3.5B for Deals

Fast Retailing Co. Ltd. has global expansion in mind — including spending up to $3.5 billion to make acquisitions.

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TOKYO — Fast Retailing Co. Ltd. has global expansion in mind — including spending up to $3.5 billion to make acquisitions.

The fashion retailer detailed its strategy Tuesday, with the long-term goal of generating sales of 1 trillion yen, or $8.7 billion at current exchange, and to "become the world's top apparel retailing firm in the future," said Tadashi Yanai, chairman, president and chief executive officer of the firm.

Fast, which owns the Uniqlo chain and the Theory brand and earlier this year lost out on its bid to acquire Barneys New York, displayed continued interest in acquisitions to "rearrange the brand portfolio that is now heavily focused on Japan's mass market." Yanai said the firm is willing to spend up to 300 billion yen, or $2.6 billion, to 400 billion yen, or $3.5 billion, to acquire brands in Europe and the U.S. The firm is looking for companies that can be platforms for its global brand operation. Entering new, fast-growing markets where it can expect high sales and profits is another key strategy, according to the firm.

Fast plans to open the first Uniqlo store in Paris in early December and a flagship there within this fiscal year ending Aug. 31, 2008, according to the firm.

The first store, which will be about 2,600 square feet, will open on Centre Commercial Les 4 Temps La Defense, 15 Parvis de La Défense. No details have been released about the flagship in Paris, but industry sources said Champs-Elysées may be the location. The firm opened a New York flagship in SoHo in November.

In London, Fast also will open a flagship of about 25,000 square feet on 311 Oxford Street on Nov. 7. On the same street and same day, the casualwear chain will open another freestanding store of about 14,000 square feet. For the fiscal year ended Aug. 31, Fast projects U.K. sales of 4.4 billion yen, or $38.2 million, with operating losses of 420 million yen, or $3.6 million, through 11 stores compared with last fiscal year's sales of 2.7 billion yen, or $23.4 million, and operating losses of 190 million yen, or $1.7 million, through eight stores.
In China, Fast opened its first upscale store in Shanghai in December. Within the next fiscal year ending Aug. 31, 2008, the chain will open three more stores in Beijing.

By 2010, the firm projects sales of 100 billion yen, or $870 million, from overseas operations