) yesterday lifted litigation charges filed against Vintage
Capital Management LLC following the latter's decision to
withdraw its takeover bid to acquire the former. Aaron's had sued
Vintage Capital to force it to disclose details of its financing
for the proposed buyout.
Vintage Capital, the second largest shareholder of Aaron's with
nearly 10% stake in the company, withdrew from its previously
offered $30.50 per share or $2.3 billion bid to acquire Aaron's
as it expressed its disappointment in the latter's decision to
buy Progressive Finance in addition to the continued distressed
Vintage Capital had made a bid to acquire all shares of Aaron's
in February this year quoting the aforementioned buyout offer
that was priced at nearly a 12.7% premium to the latest closing
price of Aaron's shares on that day. Further, the private equity
firm's offer incorporated an option to raise the buyout price
after negotiating with Aaron's management.
Subsequently, on Mar 7, Vintage Capital sent a notice to Aaron's
intimating it of the nomination of five candidates to the
latter's board at the Annual General Meeting (AGM) to be held in
May. This move was a part of Vintage Capital's intention to gain
a majority in Aaron's 9-member board.
Prior to the current offering, Vintage Capital had made 3 private
proposals for acquiring Aaron's, which were ignored by the
latter. Thereafter, the investment firm increased its
shareholding to approximately 10% in the company, consequently
becoming the largest stakeholder and decided to publicly disclose
Aaron's has been witnessing soft top and bottom-line performances
for the last several quarters. Moreover, the company believes
that the current business environment will not change
significantly in the near term.
Notably, the stock price of Aaron's gained 1.6% on Monday and
closed at $29.88.
Other Stocks to Consider
Currently, Aaron's holds a Zacks Rank #2 (Buy). Some
better-ranked stocks worth considering in the retail industry
Barnes & Noble Inc.
Rite Aid Corp.
). All of these have a Zacks Rank #1 (Strong Buy).
AARONS INC (AAN): Free Stock Analysis Report
BARNES & NOBLE (BKS): Free Stock Analysis
RITE AID CORP (RAD): Free Stock Analysis
ZALE CORP NEW (ZLC): Free Stock Analysis
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