Federated Department Stores said it would close five distribution centres in 2006 as part of its realignment of the Macy's business.

The consolidation follows Federated's acquisition of The May Department Stores Company and is aimed at maintaining efficiency and reducing duplication, the company said. The five facilities closing in 2006 are among 31 distribution centres operated by the company.

Federated will close centres in Manchester, Connecticut and Baltimore, Maryland in June 2006. The company will then close centres in Aurora, Colorado; Portland, Oregon and Salt Lake City, Utah in August.

Responsibility for merchandise handled by these facilities will be shifted to other distribution centres operated by Federated in each region of the country.

The company will try to offer affected employees transfers to facilities elsewhere, and severance packages will be provided to employees who are laid off as a result of this consolidation.

Federated vice chairman Tom Cole said: "Advances in logistics and distribution centre technology allow us to handle a larger volume of goods more effectively with fewer facilities that are more regional in nature.

"This helps us to deliver fresh fashion merchandise to the selling floors of our stores more quickly and consistently across the country".

He added: "Streamlining our distribution centre network to reduce redundancy and expense also is important to our ability to deliver value to our customers and shareholders."

Federated said last year that it will add about 330 Macy's locations nationwide in 2006 as it converts regional department store nameplates acquired its merger with The May Department Stores Company.