In a regulatory filing Monday, Sears Holdings disclosed that it is prepared to offer $6.75 a share for Restoration Hardware. That bid is higher than Restoration's current $6.70-a-share buyout agreement with a group led by private-equity firm Catterton Partners.
In a letter to Restoration Hardware's board last week, Sears said it would contemplate a merger agreement "substantially similar" to the Catterton deal, modified for a tender offer structure and a lower break-up fee. Sears is seeking to enter a confidentiality agreement with the company to do due diligence, but said in its letter that Restoration hasn't agreed to such a plan.
On Sunday, Restoration Hardware's special board committee informed Sears that it was unwilling to enter into a confidentiality agreement providing for a tender offer exception, Sears Holding's filing said.Sears Holdings, owner of the Kmart and Sears chains, disclosed last week that it bought a 13.7% stake in Restoration Hardware and was mulling an offer for the company. According to a Securities and Exchange Commission filing, Sears Holding Chairman Ed Lampert met with Restoration Hardware executives over the summer and in late October offered $4 a share for the company. But Catterton, along with Restoration Hardware CEO Gary Friedman, came along in early November with the $6.70 a share bid -- a 150% premium over the stock's price when the deal was announced.