Bombay Fielding Buyout Offers

May 28, 2007  by in UnCategorized   

By Home Furnishings Business in Furniture Retailing on May 2007 The Bombay Co., Fort Worth, Texas, announced Friday that it has received more than one offer to buy the company that has been struggling with weak sales. The announcement, which also included news a $10 million loan agreement to improve “liquidity,” said the nonbinding offers the company is evaluating represent a premium over the company’s 67 cents per share price Thursday.

With the news, shares of Bombay rose to 99 cents Friday. The company also announced last week that it faces possible delisting by the New York Stock Exchange due, in part, to its stock price dipping below $1 over a 30-day trading period.

The company hired William Blair & Co. in March to explore strategic alternatives. Updating the situation Thursday, company officials said the nonbinding offers are subject to due diligence and other conditions, and the company will not comment on the progress of the possible deals “until the appropriate time.”

The company reported an 11.9 percent decline in first-quarter revenues Thursday as same-store sales dipped 10.2 percent. The first-quarter net loss was $15.4 million compared to a net loss of $15.6 million in the same period of 2006.

“While we are disappointed with our first quarter results, which continue to be affected by softness in the retail home sector, we remain focused on our continued efforts to return Bombay to positive cash flow and long-term growth,” said CEO David Stewart Thursday. “By focusing on cost reductions and enhancing company wide efficiencies, we were able to achieve an improvement in operating results despite a $14 million decline in revenue. We believe that Bombay is positioned to strengthen its operations and improve performance.”