Chico’s FAS Inc. has rejected the unsolicited proposal received from Sycamore Partners on June 19 to acquire all of the outstanding shares of Chico’s FAS for $3 per share in cash.

Chico’s board made the determination after reviewing the proposal, in consultation with its independent financial and legal advisers. Chico’s said the proposal “substantially undervalued” Chico’s FAS and that the proposed deal was not in the best interests of its shareholders.

The board had previously rejected Sycamore’s $3.50-a-share offer made on May 10, which followed a $4.30 offer earlier this year. Sycamore said it’s been lowering its offer due to the company’s weak results and the departure of the chief executive officer.

Said Chico’s chairman David Walker: “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 under way 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 chief executive officer and will remain focused on continuing to execute in these areas.”

Walker sent a letter to Stefan Kaluzny, managing director of Sycamore, rejecting his firm’s offer, reiterating priorities stated in the first-quarter conference call, and stating, “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 under way; 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.”

Walker added that numerous shareholders support the board’s unanimous determination to reject Sycamore’s previous proposal.

Chico’s recently fired its chief executive officer Shelley Broader and gave the reins on an interim basis to Bonnie Brooks.

Goldman Sachs & Co. LLC is serving as financial adviser to Chico’s, and Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as legal counsel.

The company operates the Chico’s, White House Black Market, Soma and TellTale brands, and operates 1,410 stores in the U.S. and Canada. It also sells merchandise through 84 franchise locations in Mexico and one domestic franchise airport store, as well as through various web sites and third-party channels.

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