True Religion Sells Out

True Religion (NASDAQ: TRLG  ) is selling out.

On Friday, the Vernon, Calif.-based jeans maker announced that it has signed an agreement to be acquired by private equity firm TowerBrook Capital Partners L.P. in a transaction valued at $835 million.

TowerBrook has made similar investments in the past, and has a special interest in high-end fashion brands, having made "control-oriented investments" in companies including Jimmy Choo, Odlo, BevMo! and Phase Eight in the past.

Assuming that shareholders approve the deal, TowerBrook will pay $32 cash for each share of True Religion outstanding, a price the company' board says is 52% above where the shares traded back on October 9, just before it announced it was seeking a buyer.

The purchase price on offer values True Religion at about 1.7 times sales, and 17.6 times earnings -- somewhat short of the valuations at rival firms such as PVH Corp.  and V.F. Corporation  Yet, even so, investors today bid up the shares by only 8.1%, to $31.82 -- a price just short of TowerBrook's offer, and indicative of lack of belief that a better bid will emerge.


Read/Post Comments (0) | Recommend This Article (2)

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.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2424703, ~/Articles/ArticleHandler.aspx, 11/27/2014 5:02:34 PM

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