Vestis Retail Group Completes Tender Offer for All Outstanding Shares of Sport Chalet Stock
August 18 2014 - 8:50AM
Business Wire
Vestis Retail Group, LLC (“Vestis”) today announced the
successful completion of the cash tender offer (the “Offer”) by it
and its wholly owned subsidiary, Everest Merger Sub, Inc. (“Merger
Sub”), for all outstanding Class A and Class B shares (the
“Shares”) of Sport Chalet, Inc. (NASDAQ: SPCHA)(NASDAQ: SPCHB) at a
price of $1.20 per Share, net to the seller in cash (less any
required withholding taxes and without interest). Computershare
Trust Company, N.A., the depositary for the Offer, has advised
Vestis that, as of 12:00 midnight, New York City time, at the end
of August 15, 2014 (the “Expiration Date”), approximately 4,178,979
Class A shares and 1,455,923 Class B shares had been validly
tendered and not withdrawn in the Offer. Such tendered Shares, when
combined with the Shares that Vestis has separately agreed to
purchase from Sport Chalet’s founding family members immediately
after consummation of the Offer (the “Family Shares”), represent
approximately 94.7% of the outstanding Class A shares and 89.0% of
the outstanding Class B shares. In addition, 26,312 Class A shares
and 27,192 Class B shares were tendered through Notices of
Guaranteed Delivery that had not been delivered in settlement or
satisfaction of such guarantee, representing approximately 0.2% of
the outstanding Class A shares and 1.5% of the outstanding Class B
shares). Vestis has accepted for payment all Shares validly
tendered and not withdrawn (other than Shares tendered through
Notices of Guaranteed Delivery that had not been delivered in
settlement or satisfaction of such guarantee prior to such
acceptance) and will promptly pay for such Shares.
Merger Sub will acquire all of the remaining outstanding Shares
by means of a “short form” merger under Delaware law promptly
following the purchase of Shares in the Offer and the purchase of
the Family Shares immediately after consummation of the Offer. As a
result of the purchase of Shares in the Offer and the purchase of
the Family Shares, Merger Sub has sufficient voting power to
approve the merger without the affirmative vote of any other Sport
Chalet stockholder. In order to accomplish the merger as a “short
form” merger, Merger Sub currently intends to exercise its “top-up”
option pursuant to the previously announced merger agreement
between Vestis, Merger Sub and Sport Chalet, which permits Merger
Sub to purchase additional Shares directly from Sport Chalet for
$1.20 per Share (the same purchase price paid in the Offer). Based
on the number of Class B shares validly tendered (excluding Class B
shares tendered through Notices of Guaranteed Delivery that had not
been delivered in settlement or satisfaction of such guarantee
prior to acceptance of Shares in the Offer) and the Family Shares,
which collectively represent approximately 89.0% of the outstanding
Class B shares, Vestis expects to exercise the top-up option for
approximately 173,500 Class B shares to enable it to accomplish the
short-form merger. Following the merger, Sport Chalet will become a
wholly owned subsidiary of Vestis, and each Share (including Shares
tendered through Notices of Guaranteed Delivery that had not been
delivered in settlement or satisfaction of such guarantee prior to
acceptance of Shares in the Offer) will be cancelled and converted
into the right to receive the same $1.20 per Share consideration,
without interest, received by stockholders who validly tendered
their Shares in the Offer prior to the Expiration Date (subject to
exercise of appraisal rights).
About Sport ChaletSport Chalet (Nasdaq: SPCHA)(NASDAQ:
SPCHB) is a premier, full service specialty sporting goods retailer
featuring the industry’s top sports brands in apparel, footwear,
and sports equipment. Founded in 1959 by Norbert Olberz, the
company has 50 stores in Arizona, California, Nevada and Utah; an
online store at www.sportchalet.com; and a Team Sales division; and
offers more than 50 specialty services for the sports enthusiast,
including online same day delivery, climbing, backcountry skiing,
ski mountaineering, avalanche education, and mountain trekking
instruction, car rack installation, snowboard and ski rental and
repair, Scuba training and certification, Scuba boat charters, gait
analysis, baseball/softball glove steaming and lacing, racquet
stringing, and bicycle tune-up and repair at its store locations.
For more information, visit Sport Chalet at
www.sportchalet.com.
About Vestis Retail GroupBased in Connecticut, Vestis
Retail Group, LLC was formed by Versa Capital Management, LLC and
encompasses Bob’s Stores (Bob’s) and Eastern Mountain Sports (EMS).
Bob’s is a 60-year-old, award-winning Northeastern retailer of
value-oriented footwear, apparel and work wear. EMS is the second
largest U.S. multi-channel retailer of human-powered outdoor sports
apparel and equipment with stores in the Northeastern and
Mid-Atlantic states. More information is available at
www.bobstores.com and www.ems.com.
About Versa Capital ManagementBased in Philadelphia, PA,
Versa Capital Management, LLC is a private equity investment firm
with more than $1.4 billion of assets under management focused on
control investments in special situations involving middle market
companies where value and performance growth can be achieved
through enhanced operational and financial management. Versa’s
portfolio includes retailers Avenue Stores, EMS and Bob’s Stores;
restaurants such as Black Angus Steakhouses; community newspapers
under Civitas Media; and manufacturers that service a variety of
industries. More information can be found at www.versa.com.
Forward-Looking StatementsThis news release contains
forward-looking statements within the meaning of and made pursuant
to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. All statements other than statements of
historical fact are forward-looking statements, including all
statements regarding the intent, belief or current expectation of
the companies and members of their senior management teams. These
forward-looking statements involve significant risks and
uncertainties, including those discussed below and others that can
be found in Sport Chalet’s Form 10-K for the year ended March 30,
2014, and in any subsequent periodic reports from Sport Chalet on
Form 10-Q and Form 8-K. Vestis and Sport Chalet are providing this
information as of the date of this news release and do not
undertake any obligation to update any forward-looking statements
contained in this document as a result of new information, future
events or otherwise. Forward-looking statements can be identified
by the use of words such as “will,” “could,” “should,” “may,”
“anticipate,” “expect,” “intend,” “estimate,” “believe,” “project,”
“plan,” “potential,” “continue,” or other similar expressions.
Forward-looking statements include, without limitation,
statements regarding business combinations and similar
transactions, prospective performance and opportunities, and the
outlook for Vestis’s and Sport Chalet’s businesses, performance and
opportunities; the expected timing of the completion of the
transactions contemplated by the Merger Agreement; the ability to
complete the transactions considering the various closing
conditions; and any assumptions underlying any of the foregoing.
Investors are cautioned that any such forward-looking statements
are not guarantees of future performance and involve risks and
uncertainties and are cautioned not to place undue reliance on
these forward-looking statements. Actual results may differ
materially from those currently anticipated due to a number of
risks and uncertainties. Risks and uncertainties that could cause
the actual results to differ from expectations contemplated by
forward-looking statements include: uncertainties regarding the two
companies’ ability to integrate successfully; uncertainties as to
the timing of the Offer and the Merger; uncertainties as to how
many of Sport Chalet’s stockholders will tender their stock in the
Offer; the possibility that competing offers will be made; the
failure of Sport Chalet’s stockholders to approve the Merger; the
failure to complete the Offer or the Merger in the timeframe
expected by the parties or at all; the possibility that various
closing conditions for the transactions may not be satisfied or
waived; Sport Chalet’s ability to maintain relationships with
employees, customers, or suppliers; the negative effect of the
economic downturn and the lack of winter weather on the Sport
Chalet’s sales; limitations on borrowing under Sport Chalet’s
credit facilities; Sport Chalet’s ability to control operating
expenses and costs; the competitive environment of the sporting
goods industry in general and in Sport Chalet’s specific market
areas; the challenge of maintaining Sport Chalet’s competitive
position; Sport Chalet’s ability to maintain the growth of its Team
Sales Division and online business; Sport Chalet’s ability to
regain or subsequently maintain compliance with the requirements
for continued listing of its common stock; and changes in costs of
goods and services. These and other risks are more fully described
in Sport Chalet’s filings with the SEC.
Information Agent:Georgeson Inc.866-856-6388orSport
Chalet Contact:Steve Teng, 818-949-5300 ext.
728investorrelations@sportchalet.comorVersa and Vestis
Contacts:Abernathy MacGregorChuck Dohrenwend,
212-371-5999cod@abmac.comorRivian Bell,
213-630-6550rlb@abmac.com
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