Aaron's Shares Respond as Vintage Announces Buyout Offer
Shares of Aaron's (NYSE: AAN) gain as much as 19.076% in Friday's trading following Vintage Capital's formal letter to purchase the company.
On January 30, Vintage Capital Management scheduled a 13D filing with the U.S. Securities and Exchange Commission. Vintage owns 7,277,00 shares of Aaron's common stock, or approximately 9.5% (as of October 25, 2013).
On Friday, Vintage Capital submitted a letter to Aaron's Board of Directors containing a non-binding proposal to acquire Aaron's for $30.50 per share of common stock. Vintage offered to acquire 100% of Aaron's outstanding common stock three times since 2011. Each of these offers were privately submitted to the Board of Directors. On February 5, Vintage reiterated its interest in acquiring Aaron's with Aaron's Chairman, President and Chief Executive Officer Ron Allen.
The February 7 letter states, “Today, Vintage again proposes to acquire Aaron's in an all-cash transaction at $30.50 per share. We believe that our proposal is compelling and in the best interest of all Aarons' stakeholders, including its stockholders, employees and franchisees. Vintage is willing to sign an appropriate confidentiality agreement in order to conduct due diligence, but we do not believe that it would be in any party's interest, particularly that of Aaron's stockholders, for Vintage to agree to any “standstill” restrictions. We are confident that once the Board of Directors creates an independent committee to fully and fairly analyze our offer with the help of its professional advisors, the Board of Directors will agree with our assessment about the attractiveness of our proposal. We stand ready to participate in any legitimate value maximizing process that the Board of Directors commences, and we are also willing to explore appropriate mechanisms in any definitive agreement to ensure that the Board of Directors feels confident that it has fulfilled its fiduciary duties to Aaron's stockholders.”
During Aaron's Earnings Call, management commented that they will not comment on the offer from Vintage Capital.
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