Private equity firm Sycamore Partners has a new acquisition target in mind: teen retailer Express Inc.
The New York-based private equity firm on Thursday sent a letter to the board of Express indicating that it has taken a 9.9 percent stake in the retailer and would like to acquire the balance of the shares it does not already own.
Sycamore, through its managing director Stefan Kaluzny, said it would like to conduct due diligence on the retailer to “determine a definitive valuation of the company,” and then within 30 days after getting the OK to do the review, submit a binding, fully financed proposal for the balance of the shares.
Sycamore also noted that it has access to available funds and manages over $3.5 billion in assets. Sycamore earlier this week said it just closed on commitments of $2.5 billion for its second fund. The first fund closed in 2012 with $1 billion in commitments from investors.
A spokeswoman for Express could not be reached for comment.
At the close of trading Thursday, Express shares fell 2.6 percent to $13.55, but then climbed 19.9 percent to $16.25 after the SEC filing became public.
In a Schedule 13-D filing with the Securities and Exchange Commission on Thursday, Sycamore said it had invested through affiliates $106.2 million, inclusive of brokerage commissions, to acquire the 8.3 million shares of common stock of Express, totaling a 9.9 percent stake, in a number of transactions on the open market.
Express was once part of the portfolio of Leslie Wexner’s Limited Brands. Private equity firm Golden Gate Capital acquired a partial stake in the company. The teen retailer went public in 2010. Both Golden Gate and Limited no long own stakes in Express.