Specialty retailer and discount chain ShopKo Stores Inc. (SKO) on Friday said it agreed to be purchased for $715 million by an affiliate of private equity investment firm Goldner Hawn Johnson & Morrison Inc (search).

ShopKo shareholders will receive $24 cash per share, a premium of 4.2 percent over the stock's closing price of $23.03 on the New York Stock Exchange (search) on Thursday. Goldner Hawn will also assume $330 million of ShopKo debt.

ShopKo, which has been plagued of late by falling sales at stores open at least a year, said Jack Eugster has resigned as chairman of the board and from board committees but would remain a director while the deal is pending.

Directors John Turner and Steve Watson were named co-chairmen.

Eugster will have a continuing equity investment in the Green Bay, Wisc.-based company and is expected to serve as chairman and acting chief executive after the acquisition, until a new president and CEO is named, ShopKo said.

Sam Duncan, ShopKo's current president and CEO, has indicated he will not remain with the company following the deal, the company said.

Merrill Lynch & Co. served as adviser to a special committee of ShopKo directors that recommended the deal, the company said.

The transaction is expected to be completed in ShopKo's fiscal second quarter.