SOURCE: Brower Piven, A Professional Corporation

December 01, 2010 13:06 ET

Brower Piven Announces the Filing of a Class Action Lawsuit in Connection With the Acquisition of J. Crew Group, Inc. by TPG and Leonard Green

STEVENSON, MD--(Marketwire - December 1, 2010) - Brower Piven, A Professional Corporation announces that a class action lawsuit has been commenced in the Delaware Chancery Court on behalf of all shareholders of J. Crew Group, Inc. ("J. Crew" or the "Company") (NYSE: JCG). The claims arise out of defendants' efforts to complete the sale of J. Crew to private equity firms, TPG and Leonard Green.

According to the complaint, on November 23, 2010, J. Crew publicly disclosed that it had entered into a definitive merger agreement to be acquired and taken private by funds affiliated with TPG and Leonard Green. According to the terms of the Merger Agreement, TPG and Leonard Green will acquire all of J. Crew's outstanding common shares for $43.50 per share, or a total of approximately $3.0 billion (the "Merger Price").

The complaint alleges that the Merger Price substantially undervalues J. Crew, particularly because J. Crew is perfectly poised for growth and windfalls as a result of its future international growth as well its strong brand loyalty. The purported premium is misleading because it compares the Merger Price to an artificially and temporarily low share price caused by the Company's recent cuts in forecasts (that were presumably made at the same time the CEO was negotiating the "deal"). Further, J. Crew's financials were weakened because it voluntarily prepaid one of its loans owed to a bank who is now advising and providing financing to the acquirers in this proposed transaction. The Merger Price is also unfair and inadequate given that J. Crew's stock vaulted on news of the proposed transaction 16.84 percent to close above the Merger Price at $43.99 per share on November 23, 2010, the day of the disclosure; J. Crew's stock price traded as high as $49.91 per share as recently as April 23, 2010; and at least one analyst has set a target price for J. Crew stock at $50.00 per share.

If you are a current owner of shares of J. Crew Group, Inc. you may obtain additional information about this lawsuit by contacting Brower Piven at www.browerpiven.com, by email at piven@browerpiven.com, by calling 410/415-6701, or at Brower Piven, A Professional Corporation, 1925 Old Valley Road, Stevenson, Maryland 21153. Attorneys at Brower Piven have combined experience litigating securities and class action cases of over 50 years. If you choose to retain counsel, you may retain Brower Piven without financial obligation or cost to you, or you may retain other counsel of your choice. You need take no action at this time to be a member of the class.

Contact Information

  • CONTACT:
    Charles J. Piven
    Brower Piven, A Professional Corporation
    Stevenson, Maryland
    410/415-6701
    Email Contact