Chico’s (NYSE:CHS) stock is flying higher on Thursday after the women’s clothing store announced a $1 billion acquisition deal.
That deal has private equity firm Sycamore Partners agreeing to acquire the retail company for $7.60 per share. The firm will pay for these shares with cash, and it represents a 65% premium to the stock’s closing price on Wednesday.
Chico’s board of directors has given its unanimous support to the deal. Sycamore Partners is expecting its acquisition of Chico’s to close by the first quarter of 2024. When that happens, Chico’s will become a private company, and shares of CHS stock will no longer trade on public markets.
Molly Langenstein, president and CEO of Chico’s, said the following about the acquisition agreement:
“Through this investment, we are gaining additional expertise, financial resources and strategic flexibility to fuel the growth of our company. Sycamore Partners has an outstanding record in the retail industry in partnering with management teams to help businesses reach even greater levels of success.”
How This News Affects CHS Stock Today
With news of the acquisition agreement, shares of CHS stock are seeing incredibly heavy trading. As of this writing, more than 38 million shares of the stock have changed hands. That’s a massive surge in trading compared to the company’s daily average of 1.6 million shares.
CHS stock is up 62.7% as of Thursday morning.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
