California Apparel News

True Religion Apparel, Inc. has agreed to be acquired by TowerBrook Capital Partners L.P., a New York– and London-based investment management firm, for $835 million.

Under the terms of agreement, which were unanimously approved by the True Religion board, TowerBrook will acquire all of the outstanding shares of True Religion common stock for $32 per share in cash, which represents a 52 percent premium of the denim company’s share price on Oct. 9, 2012, the day before the company announced it was exploring strategic alternatives and looking for a buyer. Most recently, the stock was trading around $31.60 a share.

The $463.7 million upscale denim brand, based in Los Angeles, sells its products to better department stores and boutiques globally, including 124 of its own stores in the U.S. and 31 international locations.

Lynne Koplin, the company’s interim chief executive and president, said she believes this agreement offers significant value to True Religion shareholders. “At this critical inflection point in our business, global growth and product-development effort, TowerBrook’s support and experience will be a true differentiation,” she said in a statement. “TowerBrook’s long-term approach toward investment and brand stewardship will best enable True Religion to maintain its leadership position in the marketplace. We are confident the next chapter for True Religion will be a successful one for our employees, customers and all other shareholders.”

Seth Johnson, lead director of True Religion, said, “Having considered alternatives over a seven-month period, the special committee believes TowerBrook’s $32-per-share cash offer for the company is in the best interest of our shareholders.”

Andrew Rolfe, managing director of TowerBrook, said his company is excited to combine its retail and apparel expertise with the True Religion team to help the company with brand building and international opportunities.

TowerBrook has made investments in companies such as Jimmy Choo, Odlo, BevMo! and Phase Eight.

The merger is subject to approval by True Religion’s shareholders and subject to regulatory approvals. The transaction is expected to close in the third quarter of 2013.

True Religion was co-founded by Jeff Lubell in 2002. In March he stepped down from the company as chief executive, serving instead as chairman emeritus and creative consultant.

Last year, True Religion formed a special committee to “evaluate possible strategic alternatives.” The company retained Guggenheim Securities LLC as its financial adviser and Greenberg Traurig LLP and Akin Gump Strauss Hauer & Field as its legal counsel to help with the strategic review process.