Destination XL gets takeover bid from Fund 1 Investments

Destination XL Group confirms receipt of a non-binding proposal from Fund 1 Investments to acquire all of the outstanding shares of the company.

The company said in a release that its board of directors regularly reviews opportunities to create and enhance shareholder value and will carefully review and evaluate this proposal and other strategic alternatives together with its financial and legal advisors.

Fund 1 Investments disclosed its all-cash offer to take the “big and tall” men’s retailer private at a nearly 35 percent premium.

Key points from the letter sent to DXLG said: “Fund 1 is a 10.6 percent shareholder with significant consumer/retail expertise and it recently partnered with Blackstone in the 6.4 billion euros takeover of L’Occitane. Similar to L’Occitane, DXLG would be far better served outside of the public markets, having the ability to focus on free cash flow generation.”

Fund 1 notes that as a well-capitalized proposer, the company has the ability to consummate the transaction on an accelerated basis to deliver significant value to DXLG stockholders and set the company up for continued success as a privately held company.

Guggenheim Securities is acting as financial advisor and Greenberg Traurig is acting as legal advisor to Destination XL Group.