Gymboree Shares Popped: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Gymboree (Nasdaq: GYMB  ) jumped 22% today on news the company will be purchased for $1.8 billion by Bain Capital.

So What: After rumors that the company was up for sale to private equity buyers last month, Gymboree is selling itself for $65.40. This represents a 57.4% premium to the Sept. 30 closing price.

Now What: Gymboree can still solicit bids until Nov. 20, but given the premium paid by Bain, I'm doubtful bidders will emerge. As I'm writing the stock is trading at $64.97, so this could be a great exit point for shareholders who don't want to risk the deal falling through. It is unlikely Bain will back out, but there's always risk the deal won't close so it might be time to take your gains and run.

Interested in more info on Gymboree? Add it to your watchlist by clicking here.

Fool contributor Travis Hoium does not have a position in any company mentioned here. Try any of our Foolish newsletter services free for 30 days. True to its name, The Motley Fool is made up of a motley assortment of writers and analysts, each with a unique perspective; sometimes we agree, sometimes we disagree, but we all believe in the power of learning from each other through our Foolish community. The Motley Fool has a disclosure policy.


Read/Post Comments (1) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Add your comment.

DocumentId: 1328136, ~/Articles/ArticleHandler.aspx, 4/19/2014 12:46:46 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement