Myer Holdings Ltd (ASX:MYR) says it will acquire a 65 percent stake in Australia’s women’s fashion brand sass & bide for $42.25 million.

The Australian department store said it will have exclusive department store rights to distribute this iconic, designer brand, as well as benefiting from the expansion of both sass & bide’s standalone store network, and its domestic and international wholesale businesses.

The sass & bide Autumn/Winter 2011 Collection is currently available at David Jones but thereafter David Jones will cease to carry the brand.

It is planned that sass & bide will be launched in approximately 30 Myer stores over the next 18 months.

Myer chief executive Bernie Brookes, said “The investment in sass & bide is entirely consistent with our strategy for growth which is about opening new stores, investing in store refurbishments and refreshments, growing and leveraging Myer one and introducing new product categories, brands, concepts and concessions,” said Mr Brookes.

The retailer also announced today it expects a 5 per cent profit fall in the 2011 financial year, as Myer battles against fragile consumer confidence.

The latest full year earnings guidance represents a downgrade from Myer's November forecast, when net profit was tipped to grow by between 5 to 10 per cent.

Mr Brookes said the increased costs of living, anticipated flood levy and food inflation are expected to put pressure on discretionary spending for the rest of the year.

“Consumers faced increased costs of living, including utilities, health care and petrol, compounded by the impact of successive interest rate rises. We, like other discretionary retailers, have observed a consumer that is more cautious to spend and has an increasing tendency to save,” Mr Brookes said.

Total sales for the six months ended 29 January 2011 were $1,733 million, down 3.54 per cent compared to the previous corresponding period. On a like-for-like basis sales were down 5.19 per cent.