Kenneth Cole Productions Inc.(KCP) announced that it has entered into a definitive merger agreement under which Kenneth Cole, Chairman and Chief Creative Officer of the Company and the beneficial holder of approximately 46% of the Company's outstanding common stock (representing about 89% of the voting power), will acquire the Company through KCP Holdco Inc., an entity he controls that was formed for the purposes of the acquisition.
As per the agreement, the Company's shareholders, excluding Cole and his affiliated entities, will receive $15.25 per share in cash upon completion of the transaction.
The price represents a premium of 17% to the closing price of the Company's shares on February 23, 2012, the last trading day before the announcement by Cole of his proposal, and a premium of 28% over the average closing price of the Company's Class A common stock for the 45 trading days prior to that date, and implies a total enterprise value of approximately $245 million.
The merger agreement contains a non-waivable condition that a majority of the outstanding shares of the Company not owned by Cole and his affiliates and associates vote in favor of the adoption of the merger agreement.
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