From Home Furnishing Business
Rent-A-Center Gets $690M Buyout Offer from Buddy’s Owner
The offer, which is worth about $690 million, came less than a week after Rent-A-Center’s board voted to explore strategic and financial alternatives – a decision that led to the resignation of Chairman Steven Pepper.
Vintage Capital’s offer was disclosed in a Securities and Exchange Commission filing, in which the private equity firm also disclosed it owns 5.9% of Rent-A-Center’s stock.
In a letter to Rent-A-Center CEO Mark Speese, Vintage asked for a 30-day exclusivity period in which to complete its due diligence and execute a definitive purchase agreement.
“(T)he value that we are willing to pay, and our interest in pursuing this transaction, is significantly impacted by whether or not our future competitors have access to proprietary information concerning RAC’s assets, including but not limited to store-level financial information and contract terms with Acceptance Now retail partners,” the letter said.
Rent-A-Center has reported string of quarterly losses during the past year, and has been under pressure from another major stockholder, Engaged Capital, to sell or recapitalize the company. Engaged launched a proxy fight earlier this year and succeeded is replacing Speese and two other board members with its own nominees.
Buddy’s is the country’s third-largest rent-to-own operator, with about 330 stores. It is based in Orlando, Fla.
Rent-A-Center has about 2,400 rent-to-own stores in the U.S., as well as about 1,200 Acceptance Now locations.