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Shares Of Aeropostale Up 12% Following Closing Of Sycamore Partners Transaction

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In a press release on Tuesday, Aeropostale (NYSE: ARO) announced that it has entered “definitive agreements” with affiliates of Sycamore Partners, including a $150 million senior secured credit facilities.

The initial release of the partnership was announced on March 13 describing the contents of the arrangement. The press release states, “the senior secured credit facilities with affiliates of Sycamore Partners consist of a five-year $100 million term loan facility and a ten-year $50 million term loan facility that includes a sourcing arrangement with MGF Sourcing, also an affiliate of Sycamore Partners.

"Aeropostale has issued convertible preferred stock to Sycamore Partners, giving Sycamore the right to acquire up to 5% of the Company's common stock at an exercise price of $7.25, the closing price of the Company's common stock on March 12, 2014. Additionally, through the new strategic sourcing partnership with MGF Sourcing, Aeropostale has committed to complete minimum merchandise purchases each year for ten years.”

With the closing of the transaction, Aeropostale appointed two new members to the Board of Directors -- Managing director at Sycamore Partners, Stefan Kaluzny, and former Chairman and CEO of Aeropostale, Julian Geiger. In addition, Arthur Rubinfeld will step down as a director and the Board will nominate Kenneth Gilman as an independent director.

Shares of Aeropostale closed at $3.41 on Friday. The stock is currently trading up over 12 percent at $3.84.

Posted-In: Sycamore PartnersNews Offerings Contracts Management


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