Kellwood Co.'s shares rose 10 percent Tuesday to close at $18.12 on the New York Stock Exchange after Sun Capital Securities Group LLC repeated for the third time its bid of $21 a share for the St. Louis-based vendor.
But the interest in Kellwood's shares following the unsolicited offer doesn't bode well for the company, which urged its shareholders to hold off taking any action until its board reviews the bid and "make[s] a recommendation to shareholders in due course," according to a statement by Kellwood Tuesday morning.
The Kellwood statement came out while Sun Capital was holding a conference call to make its case for why shareholders should accept the bid. Kellwood pointed out the bid is the same $21 a share offer Sun Capital made twice before this fall — and which Kellwood refused both times.
"No, the price hasn't changed — they are lucky it hasn't been reduced," Jason Bernzweig, vice president of Sun Capital, said in response to Kellwood's statement Tuesday. "Absent our offer, this stock would be trading down dramatically."
Earlier this month, Kellwood made its own stock buyback offer totaling $80 million of stock at market price, then followed last week with a $60 million tender offer for its 2009 notes, using the $162 million in cash the company received from selling its Smart Shirts subsidiary.
Sun Capital has said it would lower its bid to $19.50 if Kellwood does not terminate the bond tender offer.
The public pressure on Kellwood is mounting, as Sun Capital took the offer directly to shareholders, hosted a conference call and launched a Web site, kellwoodvalue.com, that includes its letters to Kellwood.
On the call, Sun Capital, which owns 9.9 percent of Kellwood's stock, predicted the $1.6 billion vendor would dissolve its poison pill, which would block a hostile takeover, if enough shareholders supported the bid.
Bernzweig said that, based on conversations he's held, he is optimistic shareholders will accept the bid, although he expects Sun Capital will have to extend its Feb. 12 expiration date until mid-March. If its latest bid is rejected once again, Sun Capital has said it would exercise its power as Kellwood's second-largest shareholder and seek to nominate its own board for the company. Bernzweig declined to name who Sun Capital would nominate.
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast