US-based private equity firm Sycamore Partners has made a revised unsolicited proposal to acquire specialty women’s clothing retailer Chico’s FAS for $3.00 per share in cash.
The board of directors of the retailer will now carefully review the revised proposal to determine the course of action. It will consult its independent financial and legal advisors.
The board has reviewed and unanimously rejected the earlier proposal of $3.50 per share submitted by Sycamore on 10 May, as it substantially undervalued the company and was not in the best interests of its shareholders.
Numerous Chico’s FAS shareholders noted that they will support the board’s previous decision to reject the proposal and share the view that Sycamore’s proposal is inadequate. They also support the actions underway to improve performance and value creation.
The company’s board recently made various changes to its leadership team and reset priorities for growth and value creation.
It is currently focusing on driving sales through improved product and marketing; customer experience through simplified and digitised personalised service; and transforming their sourcing and supply chain operations.
Chico’s FAS hopes that these initiatives will support the company to position it to achieve its objectives.
The board also stated it is currently in search of a new CEO.
Goldman Sachs is acting as financial advisor; and Paul, Weiss, Rifkind, Wharton & Garrison as legal counsel to Chico’s FAS.