By and  on March 21, 2007

Claire's Stores Inc. said Tuesday it will be acquired by Apollo Management LP for $3.1 billion.

Under the agreement with the New York-based private equity firm, shareholders will receive $33 a share. This price represents a 7.3 percent premium over the stock's Monday closing price of $30.76.

The announcement confirmed a report in Mon­day's WWD that Apollo Management was believed to be the only private equity firm left in the bidding for Claire's Stores Inc. Financial sources said Apax Partners has dropped out of the bidding.

Those sources said a deal might happen if Apollo and Claire's agreed on price, which supposedly was the sticking point with Apax.

"After reviewing the final bids, our board of directors unanimously concluded, after in-depth consideration, that this transaction with Apollo is in the best interests of our shareholders," said Bonnie Schaefer, co-chairman and co-chief executive of the accessories retailer, in a statement.

The Schaefer family, which owns a significant percentage of the voting power, has entered into a separate agreement to vote its shares in favor of the merger.

Apollo said it believes Claire's as a private company will be able to better capitalize on opportunities in the U.S. as well as become a highly successful global specialty retailer.

The transaction is subject to customary closing conditions, including regulatory review and the approval of the transaction by shareholders. Goldman Sachs advised Claire's on the deal.

Apollo Management is a private equity firm that was founded in 1990 by Leon Black and has done over $15 billion worth of deals.

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