By  on March 17, 2011

Arcapita is looking to build its portfolio of fashion and retail firms beyond J. Jill.

The private equity and venture capital firm late Wednesday disclosed it was buying a majority stake in J. Jill from Golden Gate Capital, but one financial source said Thursday, “They’re still actively looking in the sector. They’re active and aggressive in the consumer sector in general.”

Arcapita owns Bijoux Terner, an accessories retail business, and Caribou Coffee. The firm previously owned Loehmann’s, which it sold to Istithmar, as well as Church’s Chicken and Yakima, a supplier of vehicle racks for bicycles, boats and ski equipment. Arcapita is wholly owned by the Bahrain-based Arcapita Bank and has offices in Atlanta, London, Bahrain and Singapore.

The acquisition of J. Jill should close within a few weeks and is not expected to trigger significant changes to the brand’s strategy or management, at least anytime soon, sources said. J. Jill will continue to be led by president and chief executive officer Paula Bennett and the current management team. “This shouldn’t really mean much of anything,” said a source close to the deal. “J. Jill has done well under Golden Gate,” which will remain a minority shareholder in the company. “There haven’t been any issues with lack of capital.” The source also said that J. Jill, with an estimated volume between $400 million to $450 million, is profitable.

Before Golden Gate, J. Jill was owned by The Talbots Inc., which struggled with the business. “J. Jill got rid of the harness of Talbots and has since been performing much better,” said one fashion source.

“We look forward to working closely with Paula and her team to continue their success and help the company expand its current operations and open new store locations,” said Scott Buschmann, a principal of Arcapita. “J. Jill occupies a distinct space in women’s branded apparel. We believe that the company’s strong brand equity, deep customer loyalty and proven multichannel strategy position it extremely well for continued expansion.”

Buschmann would not elaborate on any plans for J. Jill, or discuss details of the acquisition. The announcement Wednesday night confirmed WWD reports this week that Golden Gate was selling off J. Jill.

Bank of America Merrill Lynch acted as financial adviser to J. Jill on the sale, and Kirkland & Ellis LLP acted as legal adviser.

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