Sycamore in talks to buy Jones Group for less than $16/shr-sources

Reuters

By Olivia Oran

Nov 22 (Reuters) - Private equity firm Sycamore Partners LLCis in advanced talks to acquire apparel retailer Jones Group Inc and is working toward a deal in the next few weeks,according to sources familiar with the process.

Sycamore is discussing a price of less than $16 per share -or roughly $1.3 billion based on shares outstanding - and is inthe process of lining up financing for the deal, two people saidon Friday.

The sources asked not to be named because the matter is notpublic.

A final price tag as well as details of the deal structureremain in flux, however, and there is no guarantee that a dealwould materialize, the sources cautioned.

The deal structure is complex as Jones owns dozens of brands- including Nine West and Stuart Weitzman - and Sycamore maywant to offload some of these labels to other buyers, one of thepeople said.

Jones Group and Sycamore Partners declined to comment.

Sycamore, co-founded by Stefan Kaluzny who had recentlyacquired retailers Hot Topic and Talbots, is working withGuggenheim Partners on the deal.

Jones Group has a market value of $1.1 billion and it hiredCitigroup Inc over the summer to explore a sale of thecompany.

The auction followed pressure from activist hedge fundmanager Barington Capital Group LP, whose chief executive JamesMitarotonda joined the board of Jones in May. Barington urgedJones to focus on its shoe brands and to pare down its non-corefashion brands.

Private equity firm KKR & Co LP had previouslyteamed up with Sycamore to bid for the whole company, butdropped out of the process in September, sources previously toldReuters.

Apparel designer and manufacturer G-III Apparel Group which was vying for Jones against Sycamore also bowedout of bidding in recent weeks, sources said.

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