March 10 (Bloomberg) -- Target Corp., the No. 2 U.S. discount retailer, said it may sell its Mervyn's and Marshall Field's department-stores chains to concentrate on its faster-growing discount stores. The company's shares rose as much as 6 percent.

Target hired Goldman Sachs Group Inc. to review options for the businesses, Target spokeswoman Cathy Wright said. Mervyn's operates 266 stores while Marshall Field's has 62 locations.

Chief Executive Robert Ulrich said in a statement that the company has ``dedicated significant effort'' to boosting results at the two chains, which Target has previously resisted investor suggestions that it sell. Same-store sales fell 7.6 percent and 2.6 percent last year at Mervyn's and Marshall Field's, respectively, while those at the Target chain gained 4.4 percent.

``I view it as a positive,'' said Maria Azari, who helps manage $2.2 billion of assets at Denver-based Cambiar Investors LLC, including shares of Target. ``The department stores don't fit with the core Target strategy.''

Possible buyers for Marshall Fields, which had a pretax profit of $107 million of sales of $2.6 billion last year, include St. Louis-based May Department Stores Co. and Cincinnati- based Federated Department Stores Inc., Azari said.

Shares of Target, which trails Wal-Mart Stores Inc. in sales, rose to $44.25 at 6:29 p.m. after falling $1.12 to $41.73 in regular New York Stock Exchange composite trading. The stock has risen 8.7 percent this year.

Possible Buyers

Kohl's Corp., the Menomonee Falls, Wisconsin-based owner of low-priced department stores, might be a possible buyer of Mervyn's locations, Azari said. Kohl's last year expanded into California, where Mervyn's has its headquarters.

Mervyn's sales last year totaled $3.6 billion and its pretax profit was $160 million, Target said.

``Arriving at this decision was not easy or hasty,'' Chief Financial Officer Doug Scovanner said in a taped message. ``In recent years, however, both of these divisions have experienced significant challenges to their top-line growth, resulting in unfavorable trends in their financial performance.''

Each chain has about $1.8 billion in assets, he said. Mervyn's employs 29,000 people while Marshall Field's has 25,000 workers, spokeswoman Wright said.

Target, which traces its roots to the opening of a store in Minneapolis in 1902, has owned Mervyn's since 1978 and Marshall Field's since 1990.

To contact the reporter on this story: Greg Wiles in San Francisco at grwiles@bloomberg.net; Christopher Donville in Vancouver cjdonville@bloomberg.net.

Last Updated: March 10, 2004 19:27 EST