PTCY-Took two years from my initial SITT pick. but she looks to be going today!
Party City to Be Taken Private by Firms
Tuesday September 27, 11:09 am ET
Party City Agrees to Be Acquired by Private Equity Firms for $360 Million
NEW YORK (AP) -- Party supplies retailer Party City Corp. on Tuesday said it has agreed to be acquired by private equity firms Berkshire Partners LLC and Weston Presidio for $17.50 per share in cash, or a total of $360 million.
The offer price represents a 43 percent premium to Party City's Monday closing price of $12.28. Shares jumped $4.64, or 37.8 percent, to $16.92 on the Nasdaq, where it was among the top percentage gainers in the morning session.
In March, the nation's biggest party goods retailer hired a financial adviser and formed a special committee to explore strategic alternatives, as it struggled to reverse several quarters of declining sales. At the time, the decision to explore strategic options prompted the departure of its chief executive officer, who resigned over differences with the board over corporate strategy.
AAH Holdings Corp. -- the holding company for Berkshire Partners and Weston Presidio -- plan to finance the acquisition through a combination of equity contributed by the two private equity firms, and debt financing provided by investment banks Goldman Sachs and Banc of America Securities.
Party City said shareholders would realize "an attractive selling price" from the proposed deal, which would also create "significant opportunities" for customers and franchisees.
Berkshire, which has investments of $3.5 billion in retail, consumer products and manufacturing companies, said it was drawn to Party City's durable and growing business and its network of company-owned and franchised stores.
The retailer operates or franchises a total of 499 stores around the country, and last year generated chain-wide sales of about $1 billion.
The acquisition is expected to close by the end of this year or early 2006, pending the receipt of debt financing, regulatory and shareholder approval. Party City's board of directors unanimously approved the deal, and has recommended shareholders approve the transaction.
biz.yahoo.com |
