Dec 20, 2013
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Private equity firm Sycamore to buy Jones Group for $1.2 billion

Dec 20, 2013

NEW YORK, United States - Jones Group has agreed to be bought by Sycamore Partners for $15 per share, or $1.2 billion, the latest purchase of a fashion company by the private equity firm.

Jones, whose products include luxury shoe brand Stuart Weitzman and Jones New York apparel, said it expects the deal to close in the second quarter of 2014.

Nine West, a Jones Group brand

Including the assumption of Jones' net debt, the deal is worth $2.2 billion. Sycamore, co-founded by Stefan Kaluzny, Sycamore, earlier this year took teen retailer Hot Topic Inc private for $600 million, and last year bought women's apparel chain Talbots Inc for $391 million, including debt.

The $15 per share price is a 19 percent premium to share levels in April when media reports surfaced of a possible sale. That is below the 52-week high of $17.78 hit in August, and less than one-third the $47.43 all time high hit in 2001.

Jones, which in recent years has shifted its focus to high-end footwear and away from mid-tier clothing, will better be able to help its brands "reach their true potential" as a private company, said Jones CEO Wesley Card.

Jones' other brands include Anne Klein, Kurt Geiger, and Gloria Vanderbilt jeans. Its results have been weighed down this year by poor sales of its sportswear and more cautious orders by U.S. department stores.

Jones put itself up for sale in the summer, following pressure from activist hedge fund manager Barington Capital Group LP, whose chief executive, James Mitarotonda, joined the board of Jones in May. Barington urged Jones to focus on its shoe brands and to pare down its non-core fashion brands.

Citigroup Global Markets is lead financial advisor to Jones, while Peter J. Solomon Company is as financial advisor to the Jones board. Cravath, Swaine & Moore LLP is legal advisor to Jones and Skadden, Arps, Slate, Meagher & Flom LLP is as legal advisor to the independent directors on Jones' board.

Bank of America Merrill Lynch and Guggenheim Securities, are financial advisors to Sycamore. Winston & Strawn LLP, Simpson Thacher & Bartlett LLP and the Law Offices of Gary M. Holihan, P.C. are its legal advisors.

(Reporting by Phil Wahba in New York; Editing by Bob Burgdorfer)

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