Capmark Financial Group Inc.  has entered into a definitive agreement to acquire Orchard Brands Corporation for $410 million in cash, subject to various pre- and post-closing adjustments. The transaction will broaden and diversify the customer base and retail capabilities of Capmark’s wholly-owned subsidiary, Bluestem Brands, Inc.

The acquisition will be funded with a combination of cash on-hand, a new term debt syndication, and a new asset-based lending facility. The term debt will be underwritten by Credit Suisse Securities (USA) LLC and Morgan Stanley Senior Funding Inc., while Credit Suisse and U.S. Bank National Association are leading the asset based lending facility.

"Orchard Brands is a great addition to our portfolio of retail brands and this transaction fits nicely into the theme of our long-term strategic plan. The Orchard family of brands provides us with the opportunity to serve a new customer base and deepen our private-label merchandise design and sourcing expertise," said Steve Nave, Capmark’s President and Chief Executive Officer. "We’re also excited to welcome Orchard Brands’ talented group of employees, who have done a remarkable job rebuilding their company, to the Capmark family."

“We’re excited to combine the Orchard family of brands with Bluestem," said Jim Fogarty, Chief Executive Officer of Orchard Brands. “Our team is looking forward to integrating our two firms’ unique capabilities to better serve our respective customers."

Capmark is being advised by its financial adviser Morgan Stanley & Co. LLC and by its counsels Akin Gump Strauss Hauer & Feld LLP and Faegre Baker Daniels LLP. Orchard Brands is being advised by its financial advisor Goldman Sachs and by its counsel Schulte Roth & Zabel.

Capmark Financial Group Inc. is a holding company whose businesses include Bluestem Brands, Inc., a multi-brand, online retailer of a broad selection of name-brand and private label general merchandise serving low- to middle-income consumers in the U.S. Bluestem operates Fingerhut, Gettington.com and PayCheck Direct brands. Complementing each brand is a large selection of merchandise with a variety of payment options to provide customers with the flexibility of paying over time. Capmark is headquartered in Eden Prairie, MN.

Orchard Brands is a national multi-channel direct marketer offering apparel, accessories, and home products for women and men principally in the rapidly growing and underserved boomer and senior demographic. The Orchard Brands portfolio includes Blair, Haband, Norm Thompson, Solutions, Sahalie, Gold Violin, Appleseed’s, Tog Shop, LinenSource, Draper’s & Damon’s, Old Pueblo Traders, Bedford Fair and WinterSilks.