NEW YORK ( TheStreet) -- Private equity firm Sycamore Partners has walked away from a second buyout offer for struggling woman's retailer Talbots (TLB), after two bids and a half-year tussle didn't get it very far.
On Friday, Sycamore let its $3.05 a share bid for Talbots, worth roughly $215 million, expire after it had already upped a previous all-cash bid and extended deadlines for the Hingham, Mass-based retailer. Talbots shares plunged in early Friday trading by as much as 35%. It mattered little that the company, which has struggled to meet sales goals, reported a first quarter profit of 2 cents a share on better than forecast revenue on Friday, beating estimates of a loss and marking a return to profitability after a loss-making 2011.
Talbots will now consider a new buyer, while it also cuts stores and searches for a new CEO. Talbots said it remains open to a deal, but the exclusivity agreement on Sycamore's May 5 bid has expired, allowing the women's retailer that caters to the baby boomer generation seek other buyers. Talbots said it was still considering the offer so long as details are hammered out on the deal's closing and financing.
In January, shares of Talbots (TLB) surged after CNBC reported that private equity firms Golden Gate Capital and TPG Capital were interested in buying the struggling retailer after Sycamore's initial $3 bid got it nowhere. Just days later, Sycamore returned with a new buyout offer.In December, Talbots rejected Sycamore Partners $3 a share cash bid, saying that it was "inadequate and substantially undervalues the company." At the time of its bid, Sycamore owned 9% of Talbot's shares and was willing to pay a 92% premium. Talbots subsequently put itself up for sale and opened its books to Sycamore in on Jan. 30, prompting a new bid valued at $3.05. Shares of the women's retailer fell as low as $1.65 in early Friday trading. Talbots fell nearly 70% in 2011 after its quarterly losses accelerated. The Friday morning share mark is Talbot's lowest trading level since Sycamore Partners emerged as a takeover bidder.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV