DSW buys stake in Canada's Town Shoes for $62M

COLUMBUS, Ohio (AP) -- DSW will spend about $62 million to establish an operating base in Canada, acquiring a 44 percent stake in the footwear and accessories retailer Town Shoes.

The Columbus, Ohio, company said Tuesday that it will have the right to purchase the rest of Town Shoes after four years.

Town runs 182 locations across Canada, mainly under the banners The Shoe Company, Shoe Warehouse and Town Shoes. It is owned mainly by Alberta Investment Management Corp. and Callisto Capital, a Canadian private equity firm.

"We have looked at Canadian entry options for some time and decided to acquire an existing operation with a long track record of success and to use this operation as a base from which we can establish the DSW brand in Canada," CEO Mike MacDonald said.

The companies expect the deal to close next month.

Shares of DSW Inc. closed at $34.65 on Monday and have tumbled 19 percent so far this year.