and Pendleton Pike in Indianapolis on October 13, 1961. This subsidiary was one of the first discount store divisions launched by a traditional department store. The Indianapolis Ayr-Way store opened prior to the first Kmart, which opened in Garden City, Michigan, in March 1962, and the first Target store, which opened in May 1962. Ayres also opened Ayr-Way stores in other cities. Ayres encountered several challenges in establishing and operating the new discount store concept. First, Ayres needed to define a clear brand identity for the new subsidiary and its relationship to the L. S. Ayres store brand. Second, errors in selection of store locations posed challenges. Ayres built discount stores in areas of economic decline or in locations that were not yet sufficiently developed. Finally, Ayres's efforts to establish supermarkets adjacent to its discount stores proved unsuccessful. In fiscal year 1970, two years after their initial introduction, the Ayr-Way food stores, leased and operated by Scot-Lad Foods of Chicago, caused Ayres an after-tax loss of $320,000. Ayres sold its food stores to Scot-Lad Foods in 1970 and concentrated on Ayr-Way's general merchandise. After Associated Dry Goods bought Ayres in 1972, the U.S. Federal Trade Commission objected to the merger because of the anticompetitive effects of its stores in Louisville and Lexington, Kentucky, and in Evansville, Indiana, where Ayr-Way and Stewarts Dry Goods stores were located. There were also two Ayres department stores in Louisville, along with one each in Danville, Illinois, and Champaign, Illinois. Under antitrust pressure from the Federal Trade Commission, Associated Dry Goods sold its Ayr-Way discount subsidiary to the private investment banking firm Stephens Inc. for $19.9 million in 1976 and closed the deal in early 1977. In 1980, the Ayr-Way chain, consisting of 40 stores and one distribution center, was acquired by the Dayton Hudson Corporation (now Target Corporation). The stores were remodeled and reopened as Target stores in 1981. Corporate affairs In 1872, Lyman Ayres acquired controlling interest the Indianapolis dry-goods business owned by N. R. Smith and Company with an initial investment of $40,000 in sight drafts and notes. In 1874, Ayres bought out Smith's interest in the store and became its sole owner in 1895 after James G. Thomas, who owned a 25 percent stake in the store, retired from the company. L. S. Ayres and Company was incorporated in 1896 with $200,000 in capital. After Lyman's death in 1896, his son,