Perry Ellis founder George Feldenkreis may be in the clear.
After the Perry Ellis Board of Directors received an unsolicited proposal earlier this week for a higher per-share figure than Feldenkreis offered to take the company private last month, it seemed the founder's proposal might be in jeopardy. But in a statement released Thursday, the Special Committee of the Perry Ellis International Board of Directors again reaffirmed its intention to recommend that all of the company's shareholders vote for Feldenkreis' proposal.
Last month, Miami-based Perry Ellis International agreed to become a private company through a $437 million buyout led by Feldenkreis. Under the terms of the Feldenkreis proposal, Perry Ellis shareholders will receive $27.50 per share in cash at closing. The competing proposal, by Illinois-based Randa Accessories Leather Goods, offered $28 per share in cash.
The Special Committee said that Randa's proposal to acquire 100 percent of the common stock for the company was substantially similar to a previous proposal the company made and is not up to snuff with Feldenkreis' proposal, despite the price differential.
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Randa's proposal is "highly-conditional, non-binding and insufficient in terms of value and certainty," the Special Committee unanimously decided. That and other factors led the committee to determine that "re-engaging with Randa at the price offered was not in the best interest of shareholders," according to a press release. Randa's proposal included additional fees, risks and a longer transaction time.
"The Special Committee continues to unanimously believe that the Feldenkreis merger agreement is in the best interest of all Perry Ellis shareholders," the committee said.
Feldenkreis, who founded Perry Ellis 51 years ago as a Cuban refugee, was ousted as executive chairman of the company in 2017 after Perry Ellis announced it was eliminating Feldenkreis’ position of executive chairman. Feldenkreis, 82, is the company's second-largest shareholder with 11 percent of the company's shares. His son, Oscar Feldenkreis, who serves as Perry Ellis' chief executive officer, holds 7.5 percent.
Since losing his leadership position, George Feldenkreis has worked to regain control of Perry Ellis. In an interview with the Miami Herald in May, he said he was seeking to take the company private to modernize it for the contemporary retail market.
His bid to take the company private is scheduled to close during the second half of 2018, subject to approvals and closing conditions.