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Chain of craft stores going on the block

IRVING, Texas -- Michaels Stores Inc., an arts and crafts retailer, put itself up for sale yesterday and said its longtime president and chief executive, R. Michael Rouleau, is retiring. Its shares rose nearly 13 percent.

Michaels said its decision to put itself up for sale was part of its broader exploration of its strategic options.

The retailer said it would leave the CEO post vacant and named Jeffrey N. Boyer and Gregory A. Sandfort as co-presidents to succeed Rouleau in that position.

Both will report to chairman Charles J. Wyly Jr. His brother Sam is vice chairman. The Wylys are Texas financiers who took control of Michaels in 1984 and own more than 8 percent of the firm.

The company owns and operates 896 Michaels stores in 48 states and Canada, 165 Aaron Brothers stores, 11 Recollections stores, and four Star Wholesale operations.

Rouleau, a former Lowe's Cos. executive, has been CEO since 1996. Michaels was losing money, but within a few years resumed aggressive expansion and bought a wholesale decorators' company. More recently, it opened stores targeting scrapbooking enthusiasts.

In fiscal 2005, which ended Jan. 28, profit fell 35 percent, to $131 million, despite an 8 percent increase in revenue, to $3.68 billion. Sales at stores open at least a year rose 3.6 percent from the previous year.

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