Blogs | Scam Diego
Charlotte Russe Agrees to be Sold, Taken Private
By Don Bauder | Posted August 24, 2009, 8:27 a.m.
Charlotte Russe, the San Diego-based young women's clothing retailer, has agreed to be purchased at a premium of 27% over Friday's closing price. An affiliate of Advent International private equity firm will pay $17.50 a share, or about $380 million in cash with rights to buy preferred shares. The tender offer should begin Aug. 31. The company has been searching for a buyer since January. Last November, it turned down an offer from two investment firms -- enraging some shareholders. The shares are up 25.96% this morning to $17.37, so there appears to be almost no fear that the deal won't go through.
Many stockholders will find this good news. But private equity firms are not now paying premiums for companies like this one. It is probably poised to do much better in the near future, but the stockholders and analysts don't know that.
Let's see what comes next. An IPO at $35 to $40 a share in two years? Or maybe the sale to some other retailer at a similar premium to the price being offered by Advent.
By Visduh 9:26 a.m., Aug 24, 2009 > Report it
Response to post #1: The news in retailing across the nation and around the world has been grim. This deal does seem a bit strange. Charlotte Russe, however, has lower price points than some other fashion retailers selling to this market for teens and young women. Best, Don Bauder
By dbauder 12:12 p.m., Aug 24, 2009 > Report it