NEW YORK (TheStreet) -- Michaels, the arts and crafts retailer, is going public -- again.
(JPM), Goldman Sachs
(BCS), and Deutsche Bank
(DB) are the lead underwriters of an offering slated for later this month that will sell 27.8 million shares of common stock at a price somewhere between $17 and $19, according to a government filing. If all goes as planned, the offering will raise about $500 million. Michaels will trade on NASDAQ under the ticker MIK.
Michaels was taken private in 2006 by Bain Capital and Blackstone Group in a transaction valued at about $6 billion.
With more than 1,200 stores, Michaels is the largest specialty arts and crafts retailer in North America. In 2013, Michaels had $4.6 billion in sales. Michaels does not plan on paying any cash dividends in the near future and will instead use earnings to repay debt and reinvest in the company.
Along with the other generic associated risks of the offering were Michaels' concerns over their business constraints because of their considerable debt of $3.3 billion. But what really stood in the Risk Factors out was their recent data breach:"We have recently experienced a data breach and such data breach and any future failure to adequately maintain security and prevent unauthorized access to electronic and other confidential information could result in an additional data breach which could materially adversely affect our reputation, financial condition and operating results." Although the data breach story was overshadowed by the similar problem at Target, the potential for further issues could be alarming for both shoppers and investors. In July of 2010 Samuel Wyly and the estate of Charles Wyly, former Michaels executives and longtime Republican party fundraisers, lost a $550 million insider trading case for sitting on corporate boards while trading certain securities in secret through offshore entitities, according to the SEC report. Michaels was not immediately available for a response. -- Written by Whalen MacHale in New York. Follow @WMacHale