By  on November 14, 2006

NEW YORK — Private equity players have snapped up yet another apparel brand, this time Eddie Bauer Holdings Inc., in a deal valued at $614 million.

Sun Capital Partners Inc. and Golden Gate Capital have formed a new entity, Eddie B. Holding Corp., which on Monday agreed to acquire Bauer for $9.25 per share in cash. That translates to a 4.5 percent premium on Friday's closing price of $8.85, although the company said the per-share price represents a 12 percent premium on the prior four weeks' average closing price of Bauer's common stock. The total transaction value includes debt to be repaid of $328 million. The deal, while expected to close during the first quarter of 2007, is still subject to the approval of shareholders and other customary closing conditions.

The parties to the transaction were unavailable for comment due to Bauer's pending earnings report. Bauer will host its third-quarter earnings conference call today after the market closes.

"We believe that the transaction will provide Eddie Bauer with new resources and the time necessary to execute our turnaround strategy. We look forward to partnering with Sun Capital and Golden Gate, who bring extensive experience in the retail and catalogue sectors, to take our company to the next level and to capitalize on the potential of the Eddie Bauer brand," said Fabian Mansson, chief executive officer of Eddie Bauer, in a statement.

Stefan Kaluzny, managing director at Golden Gate, said in a statement that his firm is looking forward to "working with the company to continue to serve its customers with outstanding products consistent with the Eddie Bauer heritage."

Golden Gate has been busy snapping up catalogue firms for its umbrella of investments. It owns Appleseed's, Sahalie, Solutions, Drapers and Damon's, Norm Thompson, The Tog Shop and its recent acquisition, Haband's. Golden Gate's acquisition also reunites Bauer with its two former catalogue siblings: The private equity firm also owns Spiegel and Newport News, both of which were part of the Spiegel Inc. bankruptcy in March 2003, as was Eddie Bauer. The outdoor and apparel retailer was spun out of Chapter 11 as a stand-alone firm on June 21, 2005.

More recently, Golden Gate on Friday said it had completed the recapitalization of Venus Swimwear Inc., WinterSilks LLC and Venus Manufacturing in partnership with the companies' existing shareholders.

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