NEW YORK (TheStreet) - Lululemon Athletica (LULU) shares surged 6.9% to $41.73 in post-market trading after its founder Dennis "Chip" Wilson announced that he was selling half of his stock to private equity firm, Advent International.
Wilson owns approximately 40.2 million shares of the yoga apparel maker's common stock, representing approximately 27.7% of the outstanding shares. He is selling 20.1 million shares, or 13.85% of the company's shares, to Advent for a total of $845 million.
Lululemon's board of directors has given its "full support" of the transaction, according to a press release announcing the deal.
As part of the agreement, David M. Mussafer, Advent's managing partner will become co-chairman of Lululemon's board, serving alongside its current chairman Michael Casey. Advent's managing director Steven J. Collings will also be appointed to Lululemon's board, expanding its total number of directors to 12 from 10 currently.
Advent is no stranger to Lululemon. The private equity firm was previously invested in the company from 2005 through 2009. During that time, Advent "worked closely with Mr. Wilson and five of the company's current board members, including Chairman Michael Casey, to help the company expand from a regionally focused retailer to a globally recognized premium apparel brand," the release stated. The firm has $32 billion in assets under management and has invested in more than 290 buyout transactions in a variety of sectors across the world over the past 30 years.
Mussafer previously served as a director on Lululemon's board from 2005 to 2010, while Collins was a director from 2005 to 2009, the release said.