IRVING, Texas, June 30 /PRNewswire-FirstCall/ -- Michaels Stores, Inc.
(NYSE: MIK) today announced that, following a comprehensive review of
strategic alternatives that began on March 20th 2006, its Board of
Directors has approved a transaction to recapitalize the Company with
investment by two leading global private investment firms, Bain Capital and
The Blackstone Group.
(Logo: http://www.newscom.com/cgi-bin/prnh/20040804/DAMICHAELSLOGO )
Under the terms of the agreement, following the transaction Bain
Capital and Blackstone will own substantially all of the outstanding shares
of Michaels Stores, and the shareholders will receive $44 per share in
cash, representing a transaction value of more than $6 billion. This price
reflects a premium of nearly 30 percent to the closing price of the stock
prior to the Company's announcement on March 20, 2006 regarding its review
of strategic alternatives. Bain Capital and Blackstone will own equal
stakes in the company upon completion of the transaction.
Said Charles J. Wyly, Jr., Chairman of Michaels Stores, "This
transaction delivers outstanding value for all Michaels Stores'
shareholders and represents a powerful endorsement of our Company's
strategy, performance, and business prospects. Over the past decade, the
Company has become the nation's leading arts and crafts retailer and is
well-positioned for future growth. We have a proven strategy and attractive
assets, including more than 1,000 stores nationwide, a strong and loyal
customer base, and capable, experienced management and associates."
"We are delighted to partner with the Michaels management team to help
build on its already strong position in an attractive industry, and
capitalize on the significant growth opportunities that lie ahead," said
Matt Levin, a Managing Director at Bain Capital. "Our deep experience in
the retail sector reinforces our conviction that Michaels has the best
store locations, a broad and attractive assortment of products for crafters
of all ages, and a sustainable competitive advantage thanks to smart
investments in systems and infrastructure. We look forward to helping
Michaels achieve its full long-term potential."
"Michaels is a best-in-class retailer in a highly attractive category,"
said Michael Chae, Senior Managing Director of The Blackstone Group. "The
Company is very well positioned today, and we believe there is significant
opportunity still ahead of it. We look forward to partnering with the
Michaels management team to pursue these exciting opportunities."
Completion of the transaction is contingent on regulatory review and
approval by the shareholders of Michaels Stores and is expected to occur by
the end of the calendar year.
JPMorgan acted as financial advisor and Cravath, Swaine, and Moore
acted as legal advisor to Michaels Stores and to its Board of Directors in
connection with the review of strategic alternatives and with this
transaction.
Supporting a special committee of the Board of Directors were Goldman
Sachs and Wachtell, Lipton, Rosen & Katz.
Deutsche Bank, Bank of America, and Credit Suisse acted as financial
advisors, and Ropes & Gray LLP as legal advisor, to Bain Capital and
Blackstone.
About Michaels Stores
Michaels Stores, Inc. is the world's largest specialty retailer of
arts, crafts, framing, floral, wall decor, and seasonal merchandise for the
hobbyist and do-it-yourself home decorator. As of June 30, 2006, the
Company owns and operates 900 Michaels stores in 48 states and Canada, 165
Aaron Brothers stores, 11 Recollections stores and four Star Wholesale
operations.
About Bain Capital
Bain Capital (http://www.baincapital.com) is a global private investment firm
that manages several pools of capital including private equity, venture
capital, public equity, and leveraged debt assets with more then $38
billion in assets under management. Since its inception in 1984, Bain
Capital has made private equity investments and add-on acquisitions in over
230 companies around the world, including such leading retailers and
consumer companies as Toys "R" Us, Burger King, Staples, Burlington Coat
Factory, Shopper's Drug Mart, Brookstone, Domino's Pizza, Dollarama, Sealy
Corp., Sports Authority and Duane Reade. Headquartered in Boston, Bain
Capital has offices in New York, London, Munich, Hong Kong, Shanghai, and
Tokyo.
About The Blackstone Group
The Blackstone Group, a global private investment and advisory firm,
was founded in 1985. The firm has raised a total of approximately $59
billion for alternative asset investing since its formation of which
roughly $27 billion has been for private equity investing. The Private
Equity Group has over 60 experienced professionals with broad sector
expertise. Blackstone's other core businesses include Private Real Estate
Investing, Corporate Debt Investing, Hedge Funds, Mutual Fund Management,
Private Placement, Marketable Alternative Asset Management, and Investment
Banking Advisory Services. Further information is available at
http://www.blackstone.com .
SOURCE Michaels Stores, Inc.
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Related links:
http://www.michaels.com
http://www.blackstone.com http://www.baincapital.com/
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AP Archive: http://photoarchive.ap.org PRN Photo Desk
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CONTACT:
Michael Gross of Robinson Lerer & Montgomery,
+1-646-805-2003, for Michaels Stores; or Alex Stanton of Stanton
Crenshaw Communications, +1-212-780-0701, for Bain Capital; or
John Ford of The Blackstone Group, +1-212-583-5559
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