The acquisition has received unanimous approval from the board of directors at Chico's FAS and is slated to conclude by the end of Q1 2024. The terms stipulate that shareholders will receive cash payments at a rate that significantly outpaces the company's recent stock performance, the two entities said in a statement.

This transaction will not be hindered by any financing conditions and must only pass customary closing checks. This includes getting the nod from Chico's FAS shareholders and adhering to the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

Adding an element of drama to the proceedings, the agreement includes a 30-day ‘go-shop’ clause, effective until 11:59 PM ET on October 27, 2023. This permits Chico's FAS and its financial advisor to scout for potentially better acquisition offers.

"Through this investment, we are gaining additional expertise, financial resources and strategic flexibility to fuel the growth of our company and three powerful brands: Chico's, White House Black Market and Soma," said Molly Langenstein, Chico's FAS chief executive officer and president. "Sycamore Partners has an outstanding record in the retail industry in partnering with management teams to help businesses reach even greater levels of success. They share our commitment to providing solutions, building communities and creating memorable experiences to bring women confidence and joy. We look forward to working with the Sycamore Partners team to unlock Chico's FAS's full potential."

Kevin Mansell, chair of the Chico's FAS board of directors, said, "The agreement with Sycamore Partners validates Chico's FAS's leadership as a customer led, product obsessed, digital first company with a strong record of operational excellence. The transaction reflects the board's commitment to maximising shareholder value. It provides Chico's FAS shareholders with significant immediate cash value and creates exciting opportunities for employees of the Company and our brands."

"We are pleased to have reached this agreement with Chico's FAS and its board of directors. We have long admired the company's three iconic brands, including Chico's, White House Black Market and Soma," said Stefan Kaluzny, managing director of Sycamore Partners. "We look forward to partnering with the company's more than 14,000 talented associates to grow these brands by continuing to deliver excellent products and service to their devoted customers."

Post-acquisition, Chico's FAS will operate as a privately held entity and its common stock will be delisted from the New York Stock Exchange.

Fibre2Fashion News Desk (KD)