NEW YORK (Dow Jones News) -- Fashion house Polo Ralph Lauren Corp. said it agreed to acquire Club Monaco Inc., a Canadian casual-wear vendor, for $52.5 million plus assumed debt.
Polo Ralph Lauren, the New York-based maker of apparel and home products, said it will begin this week to take an offer of 13 Canadian dollars ($8.62) a share directly to Club Monaco shareholders in an effort to acquire all of Club Monaco's 6.5 million shares outstanding.Club Monaco, based in Toronto, has 125 stores.
The deal, expected to close in spring, requires Canadian regulatory approval and the tender of at least two-thirds of Club Monaco's shares to the bid.
Club Monaco chairman, president and chief executive Joseph Mimran, who owns 20 percent of the company's stock, has agreed to throw his shares behind the offer, Polo Ralph Lauren said. Mimran and current management will continue to operate Club Monaco as a unit of Polo Ralph Lauren.
Last month, Polo Ralph Lauren posted a 14 percent decline in fiscal third-quarter profit, and said it will take a pretax restructuring charge of $65 million in the current quarter to close nine stores and cut 250 employees.
The company, which had annual revenue of $1.47 billion last year, continues to grapple with increased costs, higher markdowns at retail and increased inventory.
Ralph Lauren's stock fell 43 3/4 cents to $19.50 in late morning trading on the New York Stock Exchange.