FRAMINGHAM, Mass. & NEW YORK--(BUSINESS WIRE)--Staples, Inc. (NASDAQ: SPLS or the “Company”) and Sycamore Partners, a leading private equity firm, today announced that they have entered into a merger agreement in which investment funds managed by Sycamore Partners will acquire the Company in a transaction that values Staples at an equity value of approximately $6.9 billion. Under the terms of the merger agreement, all Staples’ stockholders will receive $10.25 per share in cash for each share of common stock they own, which represents a premium of approximately 20 percent to the 10-day volume weighted average stock price for Staples shares for the period ended April 3, 2017, the last trading day prior to widespread media speculation about a potential transaction.
Staples’ Board of Directors has unanimously approved the merger agreement and recommends that all Staples stockholders vote in favor of the transaction.
Robert Sulentic, Chairman of the Board, said, “Today’s announcement is the result of a comprehensive process in which our Board, with the assistance of a transaction committee comprised of independent directors, and outside financial advisors, explored and considered various alternatives to enhance value for our stockholders. Staples’ Board believes that this process has led to a transaction which is in the best interests of our stockholders, as well as Staples and its employees.”
The transaction is subject to customary closing conditions, including the receipt of regulatory and stockholder approval, and is expected to close no later than December, 2017. The closing is not subject to a financing condition.
“With an iconic brand, a winning strategy, and dedicated and passionate associates who are deeply focused on the customer, Staples is truly an outstanding enterprise,” said Stefan Kaluzny, Managing Director of Sycamore Partners. “We have tremendous confidence in CEO Shira Goodman and great respect for the Staples management team and are excited about this opportunity to partner with them to accelerate long-term profitability.”
“The Sycamore Partners’ team shares Staples’ entrepreneurial spirit and long-term vision,” said Shira Goodman, Chief Executive Officer and President, Staples, Inc. “This transaction will enable us to drive greater value for our customers and immense opportunity for our business.”
Barclays and Morgan Stanley & Co. LLC are acting as financial advisors and Wilmer Hale LLP is acting as legal advisor to Staples.
UBS Investment Bank, BofA Merrill Lynch, Deutsche Bank, Credit Suisse, Royal Bank of Canada, Jefferies, Wells Fargo Bank, National Association and Fifth Third Bank are providing debt financing for the transaction. BofA Merrill Lynch and Deutsche Bank Securities Inc. are acting as financial advisors and Kirkland & Ellis LLP is acting as legal advisor to Sycamore Partners.
About Staples, Inc.
Staples
brings technology and people together in innovative ways to consistently
deliver products, services and expertise that elevate and delight
customers. Staples is in business with businesses and is passionate
about empowering people to become true professionals at work.
Headquartered outside of Boston, Mass., Staples, Inc. operates primarily
in North America. More information about Staples (NASDAQ: SPLS) is
available at www.staples.com.
About Sycamore Partners
Sycamore
Partners is a private equity firm based in New York specializing in
consumer and retail investments. The firm has more than $3.5 billion in
capital under management. The firm's strategy is to partner with
management teams to improve the operating profitability and strategic
value of their businesses. The firm's investment portfolio currently
includes Belk, Coldwater Creek, EMP Merchandising, Hot Topic, MGF
Sourcing, NBG Home, Nine West Holdings, Talbots, The Limited and Torrid.
IMPORTANT ADDITIONAL INFORMATION WILL BE FILED WITH THE SEC
This
filing may be deemed solicitation material in respect of the proposed
acquisition of the Company by Sycamore Partners. The Company plans to
file with the SEC and mail to its stockholders a Proxy Statement in
connection with the transaction. This filing does not constitute a
solicitation of any vote or approval. The Proxy Statement will contain
important information about Sycamore Partners, the Company, the merger
and related matters. Investors and security holders are urged to read
the Proxy Statement carefully when it is available. Investors and
security holders will be able to obtain free copies of the Proxy
Statement and other documents filed with the SEC by Sycamore Partners
and the Company through the web site maintained by the SEC at www.sec.gov.
In addition, investors and security holders will be able to obtain free
copies of the Proxy Statement from the Company by contacting Staples
Investor Relations department at investor@staples.com.
In addition, the proxy statement and our annual reports on Form 10-K,
quarterly reports on Form 10-Q, current reports on Form 8-K and
amendments to those reports filed or furnished pursuant to section 13(a)
or 15(d) of the Securities Exchange Act of 1934 are available free of
charge through our website at investor.staples.com
as soon as reasonably practicable after they are electronically filed
with, or furnished to, the SEC.
The Company, and its directors and executive officers may be deemed to be participants in the solicitation of proxies from the Company’s stockholders with respect to the transactions contemplated by the merger agreement. Information regarding the Company’s directors and executive officers, including their ownership of the Company’s securities, is contained in the Company’s Annual Report on Form 10-K for the year ended January 28, 2017 and its proxy statement dated April 20, 2017, which are filed with the SEC. Investors and security holders may obtain additional information regarding the direct and indirect interests of the Company and its directors and executive officers in the proposed transaction by reading the proxy statement and other public filings referred to above.
SAFE HARBOR FOR FORWARD-LOOKING STATEMENTS
Statements
in this press release regarding the proposed transaction between
Sycamore Partners and the Company, the expected timetable for completing
the transaction, future financial and operating results, future
opportunities for the combined company and any other statements about
Sycamore Partners and the Company managements’ future expectations,
beliefs, goals, plans or prospects constitute forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of
1995. Any statements that are not statements of historical fact
(including statements containing the words “believes,” “plans,”
“anticipates,” “expects,” estimates and similar expressions) should also
be considered to be forward looking statements, although not all
forward-looking statements contain these identifying words. Readers
should not place undue reliance on these forward-looking statements. The
Company’s actual results may differ materially from such forward-looking
statements as a result of numerous factors, some of which the Company
may not be able to predict and may not be within the Company’s control.
Factors that could cause such differences include, but are not limited
to, (i) the risk that the proposed merger may not be completed in a
timely manner, or at all, which may adversely affect the Company’s
business and the price of its common stock, (ii) the failure to satisfy
all of the closing conditions of the proposed merger, including the
adoption of the merger agreement by the Company’s stockholders and the
receipt of certain governmental and regulatory approvals in the U.S. and
in foreign jurisdictions, (iii) the occurrence of any event, change or
other circumstance that could give rise to the termination of the merger
agreement, (iv) the effect of the announcement or pendency of the
proposed merger on the Company’s business, operating results, and
relationships with customers, suppliers, competitors and others, (v)
risks that the proposed merger may disrupt the Company’s current plans
and business operations, (vi) potential difficulties retaining employees
as a result of the proposed merger, (vii) risks related to the diverting
of management’s attention from the Company’s ongoing business
operations, and (viii) the outcome of any legal proceedings that may be
instituted against the Company related to the merger agreement or the
proposed merger. There are a number of important, additional factors
that could cause actual results or events to differ materially from
those indicated by such forward looking statements, including the
factors described in the Company’s Annual Report on Form 10-K for the
year ended January 28, 2017 and its most recent quarterly report filed
with the SEC. The Company disclaims any intention or obligation to
update any forward-looking statements as a result of developments
occurring after the date of this press release.
