FORT MYERS, Fla., June 27, 2019 /PRNewswire/ -- Chico's FAS,
Inc. (NYSE: CHS) (the "Company") today announced that its Board of
Directors (the "Board") has unanimously rejected the unsolicited
proposal received from Sycamore Partners ("Sycamore") on
June 19, 2019 to acquire all of the
outstanding shares of Chico's FAS for $3.00 per share in cash.
After reviewing the proposal in consultation with its
independent financial and legal advisors, the Chico's FAS Board
determined that Sycamore's proposal substantially undervalues
Chico's FAS and is not in the best interests of Chico's FAS
shareholders. The Board's determination follows its review and
unanimous rejection of Sycamore's previous proposal on May 10, 2019 to acquire Chico's FAS for
$3.50 per share in cash.
David Walker, Chair of the Board,
said, "Our focus is on serving the best interests of all Chico's
FAS shareholders, and we are pleased with the strong support we
have received from numerous Chico's FAS shareholders for the
actions underway to improve the Company's performance.
Notably, shareholders have also expressed their belief that
Sycamore's proposal significantly undervalues the Company. We
remain committed to enhancing value for all Chico's FAS
shareholders. We are making progress on our new operating
priorities and the search for a new CEO, and will remain focused on
continuing to execute in these areas."
Following is the full text of the letter that was sent on
June 27, 2019, to Stefan Kaluzny, Managing Director of
Sycamore:
Sycamore Partners Management,
L.P.
9 West 57th Street, 31st Floor
New York, New York 10019
Attention: Stefan Kaluzny, Managing
Director
Dear Mr. Kaluzny:
The Chico's FAS, Inc. Board of
Directors has carefully reviewed your June
19, 2019 proposal to acquire Chico's FAS for $3.00 per share in cash. After conducting
an analysis with assistance from our legal and financial advisors,
the Chico's FAS Board determined that your proposal significantly
undervalues the Company and is not in the best interests of Chico's
FAS and its shareholders. Accordingly, the Chico's FAS Board has
unanimously determined to reject your proposal.
As we detailed on our first
quarter 2019 earnings call, we have recently made significant
changes to the Company's leadership and reset priorities for growth
and value creation. We have narrowed our focus and are now
solely concentrated on three distinct areas that will positively
impact our results, with sales-driving, customer-facing and
supply-chain operational initiatives front and center.
Implementation is underway; leaders who have successfully
completed other apparel retail turnarounds are taking charge; and
our search for a new CEO is proceeding ahead of plan with
candidates who are enthusiastic about the Company and our
brands.
We are confident that Chico's FAS
is well positioned to deliver value significantly in excess of what
Sycamore has proposed. Notably, numerous shareholders with
whom we have spoken support the Board's unanimous determination to
reject Sycamore's previous proposal. Chico's FAS shareholders
share our view that Sycamore's previous proposal is inadequate and
fails to recognize the full value of the Company and its future
prospects.
The members of the Chico's FAS
Board have taken, and will continue to take, their responsibilities
to Chico's FAS shareholders seriously. We remain committed to
enhancing value for all Chico's FAS shareholders and are focusing
our attention on the continued execution of our business plans.
On behalf of the Chico's FAS Board
of Directors,
David
Walker
Chair of the Board
Goldman Sachs & Co. LLC is serving as financial advisor to
Chico's FAS, and Paul, Weiss, Rifkind, Wharton & Garrison LLP
is serving as legal counsel.
ABOUT CHICO'S FAS, INC.
The Company, through its brands – Chico's, White House Black
Market, Soma and TellTale™ is a leading omnichannel specialty
retailer of women's private branded, sophisticated,
casual-to-dressy clothing, intimates and complementary
accessories.
As of May 4, 2019, the Company
operated 1,410 stores in the U.S. and Canada and sold merchandise through 84
international franchise locations in Mexico and one domestic franchise airport
store. The Company's merchandise is also available at
www.chicos.com, www.chicosofftherack.com, www.whbm.com,
www.soma.com and www.mytelltale.com as well as through third party
channels.
For more detailed information on the Company, please go to our
corporate website at www.chicosfas.com. The information on our
corporate website is not, and shall not be deemed to be, a part of
this press release or incorporated into our federal securities law
filings.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995
This release contains statements that constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. The statements relate to, among other things,
expectations, estimates and projections regarding the brand's new
product initiatives and are identified by use of the words
"anticipate," "believe," "could," "estimate," "expect," "intend,"
"may," "plan," "outlook," "predict," "project," "should,"
"strategy," "target," "will," "would," "potential" and similar
terms. Factors that could cause actual results to differ include,
but are not limited to: the extent of the market demand and overall
level of spending for women's private branded clothing and related
accessories; the effectiveness of our brand awareness and marketing
programs; the ability to successfully execute our business
strategies and to achieve the expected results from them; the
successful recruitment of leadership and the successful integration
of new members of our senior management team; and the risk that our
investments in merchandise or marketing initiatives may not deliver
the results we anticipate. Other risk factors for the Chico's FAS,
Inc.'s business are detailed from time to time in the Chico's FAS,
Inc.'s Quarterly Reports on Form 10-Q, Annual Report on Form 10-K
and other reports filed with the Securities and Exchange
Commission. These factors should be considered in evaluating
forward looking statements contained herein.
Contacts:
Investors
Julie Lorigan
Vice President – Investor Relations,
Public Relations and Corporate Communications
Chico's FAS, Inc.
(239) 346-4199
Arthur B. Crozier / Jennifer Shotwell / Jon
Salzberger
Innisfree M&A Incorporated
(212) 750 5833
Media
Barrett Golden / Leigh
Parrish
Joele Frank, Wilkinson Brimmer
Katcher
(212) 355 4449
View original content to download
multimedia:http://www.prnewswire.com/news-releases/chicos-fas-inc-board-of-directors-unanimously-rejects-unsolicited-proposal-from-sycamore-partners-300876383.html
SOURCE Chico's FAS, Inc.