Value department store chain Burlington Coat Factory said it has signed a definitive merger agreement to be bought by Bain Capital for US$2.06bn.

Burlington announced the deal, which confirmed industry whispers early this month, following a review of strategic alternatives.

Monroe Milstein, Burlington chairman, president and chief executive, said: "We are thrilled...a transaction with Bain Capital delivers significant value to our stockholders".

Bain Capital managing director said Jordan Hitch commented: "Burlington Coat Factory is a well-managed retail business with a strong consumer following, high-quality product offerings, and good growth prospects".

Hitch said Bain would work with Burlington's management to "build on the company's track record of success in merchandising and store operations and to continue to grow the store portfolio".

The transaction is subject to approval by the company's stockholders and other customary closing conditions.

Burlington sells branded apparel such as coats, ladies' sportswear, men's wear, family footwear, baby furniture and accessories.

Bain is a global private investment firm that manages several pools of capital including private equity, venture capital, public equity and leveraged debt assets.