It's not every day that a company languishing on its deathbed gets both a reprieve and a 150% buyout premium. So let Restoration Hardware
You've got to admire the tight-lipped nature of the purchase. You often see stocks begin to inch higher as buyout details start to trickle through loose lips before an official announcement. Not here. Restoration Hardware hit a fresh four-year low on Tuesday.
Then again, maybe news of the deal did leak out early, but everyone was just too incredulously perplexed to believe that it was really happening. Restoration Hardware? Really? If Carrie is prom queen, there has to be a bucket of pigs' blood dangling overhead, right?
Rival Bombay was acquired last month, but for only a pittance after it filed for Chapter 11 bankruptcy protection. Kirkland's
I've been a fan of Restoration Hardware in the past, though recent quarterly struggles were killing the company's prospects.
"Red may be fashionable, but no one likes to see it on an income statement," fellow Fool Larry Rothman wrote in covering the company's latest disappointing report. Red was also making a messy cameo in the company's balance sheet, threatening the company's state if it couldn't drum up enough operating cash flow to improve on its 60% debt-to-capital ratio.
In short, this is a happy ending to a deteriorating story. It's also great news for Restoration Hardware's peers. Williams-Sonoma
Well? There's no bucket of blood hanging from the crossbeam, so who is the next retailer to take the stage and don the crown?
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