Sycamore Partners signals purchase of Express
Stefan Kaluzny wants to rekindle an old romance with Express.
The voracious buyout big’s Sycamore Partners, which lately has scooped up troubled retail brands such as Hot Topic and Talbots, signaled it wants to acquire Express, a mall-based clothier that caters to a 20-something clientele.
Sycamore disclosed a 9.9-percent stake in the Columbus, Ohio-based chain, saying it would like to close a deal within 30 days of doing due diligence on the company’s books.
The board of the 632-store Express chain responded by adopting an anti-takeover “poison pill.”
The retailer said it’s open to talks, however, and has hired Perella Weinberg and Sullivan & Cromwell as advisers.
Express shares soared 21 percent to close at $16.45 Friday.
The twist: Kaluzny has engineered a buyout of Express before, in 2007, as an exec at Golden Gate Partners, which had acquired Express from L Brands, the retail empire controlled by billionaire Les Wexner.
Indeed, Kaluzny, for 19 months ended in November 2011, served on the Express board working with the retailer’s then-and-current CEO Michael Weiss to turn the company around.
Like Wexner, Kaluzny looks determined to build an empire of mall-based retail brands. Wexner’s shopping-mall stalwarts have included Victoria’s Secret, Bath & Body Works and Abercrombie & Fitch.
Most recently, Kaluzny extended financing to Aeropostale. His acquisitions also include a controlling stake in Mast Global Sourcing, which supplies fashions to L Brands.
Express, which Golden Gate took public in 2010, has lately faltered amid increased competition from other mall-based chains and fast-fashion outlets like Forever 21 and H&M.
“Given the strategic and operational challenges faced by specialty retailers generally and the company in particular, a fully financed, binding, all-cash offer to acquire the company would be a valuable alternative,” Kaluzny said in a Thursday letter to the Express board.
In a research note to clients, UBS analyst Roxanne Meyer called Sycamore’s overture “highly credible,” estimating a deal could happen at between $21 and $25 a share.