Affiliate of Sun Capital Partners, Inc. and Goody's Family Clothing Inc. Enter Into a Definitive Agreement for the Acquisition o
October 10 2005 - 6:30AM
PR Newswire (US)
BOCA RATON, Fla. and KNOXVILLE, Tenn., Oct. 10
/PRNewswire-FirstCall/ -- Sun Capital Partners, Inc., a leading
private investment firm specializing in leveraged buyouts and
investments in market-leading companies and Goody's Family
Clothing, Inc. (NASDAQ:GDYS), today announced that an affiliate of
Sun Capital Partners, Inc. and Goody's have entered into a
definitive agreement for Sun to acquire Goody's. About the
Transaction Under the terms of the agreement, an affiliate of Sun
Capital Partners, Inc. will commence a tender offer for all of the
issued and outstanding shares of common stock of Goody's Family
Clothing, Inc. for $8.00 per share. Consummation of the tender
offer is subject to certain terms and conditions, including the
tender of at least 51% of the outstanding common stock, on a fully
diluted basis. Subsequent to the successful completion of the
tender offer, any remaining shares of Goody's common stock will be
acquired in a cash merger at a price of $8.00 per share. Robert M.
Goodfriend, Chairman and Chief Executive Officer of Goody's,
members of his family and family trusts who beneficially own an
aggregate of approximately 42% of the outstanding shares have
agreed to tender their shares in the transaction. The definitive
agreements with the Company and the Goodfriend family will be
subject to the continued support of the Goody's Board of Directors
in the exercise of its fiduciary duties. Funding for the payment of
the shares purchased in the offer and for the merger consideration
will consist of a combination of equity contributions from
affiliates of Sun Capital Partners, Inc. as well as a loan from one
or more banks or institutional lenders. Consummation of the
transaction is not conditioned upon financing. The Board of
Directors of Goody's has unanimously approved the transaction.
Rothschild, Inc. is providing financial advisory services to the
Board. Mr. Goodfriend commented, "Prior to its approval of this
agreement, the Board of Directors conducted a lengthy process and
considered a variety of strategic alternatives. The Board
unanimously approved the transaction, taking into account the
challenges facing the Company, the high likelihood of closure of
this transaction and the highly conditional nature of other
alternatives. As the shareholder with the largest stake in Goody's
and also an acute understanding of those challenges, I personally
support this transaction. I have spent most of my life with the
Goody's organization and have a great passion for this Company and
its people. I move forward with this transaction with confidence
that the new ownership team will maintain Goody's high level of
commitment to its customer, employee and vendor constituencies."
Mr. Goodfriend added: "The Company has recently received two
unsolicited proposals during our exclusivity period with Sun
Capital Partners. However, these proposals were received prior to
the proposing parties having had an opportunity to review the
agreement we are announcing today." Michael Kalb, a Managing
Director of Sun Capital Partners, Inc., said, "Supported by
approximately 11,000 dedicated associates, Goody's has historically
been a formidable retailer. That being said, the Company today
faces challenges brought about by the continuous evolution of
today's retail environment. Given our track record of successfully
reinvigorating numerous other retailers, we believe we are the
ideal partner to support Goody's as its associates work to solidify
the Company's market position and reestablish itself as a premier
moderately priced retailer of family apparel." About Sun Capital
Partners, Inc. Sun Capital Partners, Inc. is a leading private
investment firm focused on leveraged buyouts and investments in
market-leading companies that can benefit from its in-house
operating experience and expertise. Sun Capital Partners, Inc. has
offices in Boca Raton, Los Angeles, New York, and London. With more
than $2.5 billion of equity capital under management, affiliates of
Sun Capital Partners, Inc. have acquired more than 95 companies
throughout the world with consolidated sales in excess of $22.0
billion. About Goody's Family Clothing, Inc. Goody's, headquartered
in Knoxville, Tennessee, is a retailer of moderately priced family
apparel, and with the temporary closure of six stores due to
hurricane damage, currently operates 368 stores in the 20 states of
Alabama, Arkansas, Florida, Georgia, Illinois, Indiana, Iowa,
Kansas, Kentucky, Louisiana, Mississippi, Missouri, North Carolina,
Ohio, Oklahoma, South Carolina, Tennessee, Texas, Virginia and West
Virginia. Additional Information The description contained herein
is neither an offer to purchase nor a solicitation of an offer to
sell shares of Goody's Family Clothing, Inc. At the time the tender
offer is commenced, an affiliate of Sun Capital Partners, Inc. will
file a Tender Offer Statement and Goody's Family Clothing, Inc.
will file a Solicitation/Recommendation Statement with respect to
the offer. The Tender Offer Statement (including an offer to
purchase, a related letter of transmittal and other offer
documents) and the Solicitation/Recommendation Statement will
contain important information that should be read carefully before
any decision is made with respect to the offer. The offer to
purchase, the related letter of transmittal and certain other
documents, as well as the Solicitation/Recommendation Statement,
will be made available to all shareholders of Goody's Family
Clothing, Inc., at no expense to them. The Tender Offer Statement
(including an offer to purchase, a related letter of transmittal
and other offer documents) and the Solicitation/Recommendation
Statement will also be available at no charge at the SEC's website
at http://www.sec.gov/. This press release contains certain
forward-looking statements which are based upon current
expectations relating to the expected timing and scope of the
acquisition and these statements involve material risks and
uncertainties including, but not limited to the satisfaction of the
conditions to closing of the tender offer, which include: (i) that
there be no event or occurrence which would have a material adverse
effect on the Company; (ii) that there be no law, order or
injunction that would affect the ability of the parties to
consummate the tender offer; (iii) that there be no action by a
governmental authority challenging the transaction; (iv) that the
Company receives the approval of its lenders; and (v) certain other
conditions to be met by the Company. Readers are cautioned that any
such forward-looking statement is not a guarantee of future results
and involves risks and uncertainties, and that actual results and
outcomes may differ materially from those projected in the
forward-looking statements. The Company does not undertake to
publicly update or revise its forward-looking statements even if
future changes make it clear that any projected results or outcomes
expressed or implied therein will not be realized. DATASOURCE:
Goody's Family Clothing, Inc. CONTACT: Edward R. Carlin, CFO of
Goody's Family Clothing, Inc., +1-865-966-2000
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