J Crew Group agrees to $ 3-bn acquisition deal

NEW YORK: Clothing retailer J Crew Group Inc has agreed to be bought by two private equity firms TPG Capital and Leonard Green & Partners for about $ 3 billion.

J Crew Group Inc said in a statement that it has entered into a definitive agreement to be acquired by funds affiliated with TPG Capital and Leonard Green & Partners.

Under the terms of the agreement, shareholders of J Crew will receive $ 43.50 per share in cash, or a total of about $ 3 billion. This represents a premium of 29 per cent to J Crew's average closing share price over the last month.

"I am excited to be partnering with TPG Capital (former owner of J Crew )and Leonard Green & Partners on this transaction and our management team, including our President Jenna Lyons, will continue to work towards our future," J Crew Chairman and CEO Millard Drexler said.

Besides, the company said that Millard Drexler will continue as the chairman and chief executive officer and maintain a significant equity investment in J Crew.

Drexler, who has been working with the New York-based chain since 2003, positioned the firm as a seller of high-end casual gear and expanded into new areas such as bridal wear.

The investor group has secured committed financing from Bank of America Merrill Lynch and Goldman Sachs Bank in USA.

Meanwhile, the company said its net income declined to $ 37.8 million for the three-month period ended October 31, from $ 43.9 million in the same quarter of last year, while revenues increased 12 per cent from year-earlier to $ 429.3 million in the quarter under review.