Caldor plans to regionalize its distribution operations.

NORWALK, Conn.--(BUSINESS WIRE)--June 17, 1996--The Caldor Corporation (NYSE: CLD) today announced details of its plans to regionalize its distribution operations. The shift to a regional system is expected to streamline the Company's distribution process and generate significant, long-term cost savings.

As a key element of the plan, Caldor will open a new state-of-the-art distribution center in Westfield, Massachusetts in August 1996. This will be a fully automated facility that is strategically located to serve Caldor's stores, which are heavily concentrated in New England and the Mid-Atlantic states.

In conjunction with the opening of Westfield, Caldor will close its existing distribution center in Newburgh, New York. As a result of planned store closings in Upstate New York and the Company's need for automated distribution operations, the Newburgh facility -- which is not automated -- is no longer suited to serve the Company's needs under regionalization. This facility is expected to close on or about November 1, 1996. Approximately 175 of the existing 400 positions in Newburgh will be phased out beginning in August, with additional layoffs expected in September and October.

Currently, all Caldor stores are serviced by both the Company's Newburgh and North Bergen, New Jersey facilities, with the Newburgh location handling only bulk merchandise. Following the opening of the Westfield center in August, each Caldor store will be served by either the Westfield regional facility or the North Bergen regional facility.

Don R. Clarke, Chairman and Chief Executive Officer of Caldor, stated, "By converting to a regional distribution system and opening an automated regional facility in Westfield, Caldor will be able to manage the flow of merchandise to its stores more efficiently. This will provide us with greater control over store inventories and will result in substantial cost savings.

"It is always difficult to close operations, and we will make every effort possible to ease the transition for our employees in Newburgh. Caldor will provide severance payments and a range of placement services and training. In addition, Newburgh employees will be considered for transfer to other operations."

The Caldor Corporation is the fourth largest discount department store chain in the U.S., with annual sales of approximately $2.8 billion and approximately 24,000 Associates. It currently operates 171 stores in ten East Coast states and has plans to close 12 stores and open two additional stores later this year. With a strong consumer franchise in high density urban/suburban markets, Caldor offers a diverse merchandise selection, including both softline and hardline merchandise.

CONTACT: Kekst and Co.

Wendi Kopsick/Jim Fingeroth, 212/593-2655