Golden Gate Buys J. Jill For $75M
Talbots paid roughly $517m for the property three years earlier
June 9, 2009
Talbots Inc. said Monday that it has agreed to sell its J. Jill retail chain to San Francisco buyout firm Golden Gate Capital for $75 million.
A $280.2 million market-capitalized company, Talbots divested the business that it acquired for $517 million excluding debt three years ago. It sold the Quincy, Mass.-based retail chain as part of its turnaround effort to build upon its core Talbots brand.
Neither Talbots nor Golden Gate disclosed how the private equity firm plans to finance its purchase of the company, led by president Paula Bennett.
Golden Gate is acquiring the business through an entity named Jill Acquisition LLC. It is the second apparel-related investment by the private equity firm since last week when it supported an investment in Ashland, Ore.-based flame-resistant apparel maker Massif Holdings LLC.
Although the private equity firm invests in a diverse array of industries, it has executed 20 retail acquisitions in the past five years. The firm also has an investment in trendy retailer Express.
As part of the deal, Golden Gate will take over 204 store leases from J. Jill's 279 locations, leaving the remainder of locations to be closed. J. Jill will remain headquartered in Quincy and continue to be run by Bennett.
Talbots, whose stock has traded at a range of $1.19 a share to $17.97 each over the past year, acquired J. Jill for roughly $517 million in 2006.
Talbots is 54.2% owned by Aeon U.S.A. Inc., a unit of Japanese retailer Aeon Co. Its next largest shareholder is Columbia Wanger Asset Management LP, a Chicago firm that owns 10.7% of its common stock, according to Securities and Exchange Commission filings.
The seller's board has already approved J. Jill's sale.
Moelis & Co. is serving as the financial adviser to Talbots, which is using Dewey & LeBoeuf LLP and Day Pitney LLP for counsel. Kirkland & Ellis LLP is providing counsel to Golden Gate.
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