Aomori Group – Talbots Sold For $193 Million.
“Aomori Group”: Sycamore Partners is set to buy clothing chain Talbots in a deal worth $193.3 million.
The New York based private equity firm, Sycamore Partners, is to take struggling retail clothing chain Talbots private in a deal that sources close to the negotiations have told “Aomori Group” is worth $193.3 million in cash.
Aomori Group understands that Talbots’ shareholders are to receive $2.75 per ordinary share, significantly higher than the $1.29 that it closed at on Wednesday.
The offer is also significantly lower than the original $3 per share offered when Sycamore first made an offer back in December and represents a very healthy $215 million discount on the $3.05 that was offered last month.
The reduced offer comes after Sycamore gained access to Talbots’ books, according to Aomori Group source. Talbots’ CEO Trudy Sullivan had gambled on winning younger customers with a trendier product line and lost, resulting in a financial situation that was less than appealing, allowing Sycamore to reduce their bid.
Sullivan said in a statement after the deal became public that “we are pleased with the value this transaction delivers to our stockholders and believe that this is a positive development for all of our stakeholders.”
Talbots has been struggling over the past five years, posting losses in four. They have instigated cost cutting measures by closing stores, cutting inventory, redundancies and reduced hours as well as limiting marketing expenditure.
The Talbots’ board has given its approval to the Sycamore bid, which Aomori Group expects to be completed before the fourth quarter.
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