TORONTO - Shares of furniture retailer The Brick are set to rise after announcing a $700-million friendly deal on the weekend to be bought by rival Leon's Furniture Ltd.

Leon's (TSX:LNF) says it will pay $5.40 per share.

The Brick (TSX:BRK) shares last closed at $3.50 on the Toronto Stock Exchange.

The deal comes amid a tough economic climate for furniture retailers with a number of factors, including a softening housing market, taking a toll on sales.

Leon's has 76 stores with locations in every province except British Columbia.

The Brick, which is based in Edmonton, has 230 stores operating under The Brick, United Furniture Warehouse, The Brick Mattress Store and Urban Brick banners.