Sycamore withdraws from Talbots buyout

Talbots Inc. has to “continue to explore strategic alternatives” after private equity firm Sycamore Partners informed that it is “not prepared to execute a transaction” to acquire the women’s apparel retailer for $3.05 per share.

 
New York-based Sycamore is "not prepared to execute a transaction at this time," after luring Talbots into exclusive talks during the months, the private investing firm said in a statement last Friday.
 
However, the womenswear seller "remains open to pursuing a transaction with Sycamore Partners". “The Company remains open to pursuing a transaction with Sycamore Partners at $3.05 per share pursuant to an acceptable merger agreement providing for an appropriate level of closing certainty and supported by firm debt and equity financing commitments.  The Company is no longer subject to exclusivity and therefore will actively explore other strategic alternatives and in the meantime will continue to be focused on executing its business plan and creating value for its shareholders,” advanced Talbots in its statement.
 
According to the ‘New York Post’, some insiders said the withdrawal by Sycamore was likely a hardball tactic by co-founder Stefan Kaluzny. "The board probably needs a wake-up call," said one retail insider, adding that Talbots directors have "had a hard time getting their head around the idea that the stock isn't going to go back to $10 by itself," reported Fox News.
 
 
Talbots Inc. reported first quarter adjusted income from continuing of $0.09 per share Friday morning, compared to $0.08 per share last year.  The consensus estimate was for a loss of $0.02. Shares of the ailing retailer slipped to $1.05, or 41%, to close at $1.51 - their biggest intra-day loss in the past 12 months- after the news from Sycamore arose.