NEW YORK ( TheStreet) -- Zale (ZLC) is planning to sell a minority stake in the company to private-equity firm Golden Gate, according to several reports, and shares of Zale are surging in Wednesday morning trading on the news.
Golden Gate's offer was chosen over proposals from Centerbridge Capital Partners and TPG, Bloomberg reported -- though the deal, of course, could still crumble.
Zale's sales have been struggling amid the recession, forcing the company to hire turnaround firm Peter J. Solomon to help it find investors.
The company also has only a few days left to decide whether or not to pay a $6 million Citibank fine to handle its credit card business. At the end of March, Zale extended the due date for the fee to the end of April.A bulk of Zale's sales are made through credit cards, and without the financing it could lose a significant portion of its business. Shares of Zale are surging 7.9% to $3.43 in morning trading on the news. -- Reported by Jeanine Poggi in New York. Follow TheStreet.com on Twitter and become a fan on Facebook.