The TJX Companies, parent of US retail chain TJ Maxx, has made a definitive agreement to acquire a 35% stake in the United Arab Emirates' (UAE) retailer the Brands for Less (BFL) Group for $360m.  

The transaction, which is subject to customary working capital adjustments, is anticipated to be finalised later in fiscal 2025 and values BFL at an enterprise value of $1.2bn. 

BFL, headquartered in Dubai, is recognised as one of the region's premier off-price retailers offering branded apparel, toys and home fashions.  

The retailer operates more than 100 stores primarily in the UAE and Saudi Arabia, and an e-commerce platform.  

Although TJX's investment will be a non-controlling, minority position, the company expects this to be slightly accretive to earnings per share from fiscal 2026.  

TJX will adopt the equity method of accounting for this investment from the date of the transaction and will report its share of BFL's financial results with a one-quarter delay. 

The transaction provides TJX an opportunity to invest in an established, off-price retailer with growth potential. 

BofA Securities served as the financial advisor, while Ropes & Gray provided legal counsel to TJX.

The investment comes as TJX reported a strong financial performance in the second quarter of fiscal 2025, with net sales reaching $13.5bn, a 6% increase from the previous year.  

The company’s comparable store sales grew by 4%, and net income reached $1.1bn, with diluted earnings per share up by 13% to $0.96. 

The TJX Companies CEO and president Ernie Herrman stated: “I am extremely pleased with our second quarter performance. Our comparable store sales increase of 4%, pretax profit margin and earnings per share all exceeded our plans.  

“Our teams sharply executed on our mission to deliver great value to consumers every day. Our overall comp sales growth was entirely driven by customer transactions, which increased at every division.”