J Crew close to settling lawsuit tied to its takeover: report

(Reuters) - U.S. clothing retailer J Crew Group Inc JCG.N is close to settling a shareholder lawsuit over its proposed takeover by private equity firms TPG Capital TPG.UL and Leonard Green & Partners LP, Bloomberg said, citing two people with knowledge of the matter.

A $2.86 billion deal to acquire J Crew was announced on November 23, with TPG Group and Leonard Green & Partners LP agreeing to buy the company for $43.50 a share, a premium of about 15 percent.

Lawsuits have protested the proposed sale price and asserted that J Crew Chairman and Chief Executive Millard Drexler potentially breached his fiduciary duties to investors.

Shares of J Crew closed Friday at $43.82 on the New York Stock Exchange.

As part of the settlement, J Crew would extend the period to solicit competing offers until February 15, the agency said.

An agreement would also include a $10 million payment to plaintiffs and may be announced as soon as Tuesday, the people told the agency.

The retailer would also add provisions that would make it easier to accept a rival bid, the people told the agency.

J Crew received no rival takeover bids during its "go shop" period and will remain with its original $2.86 billion buyout offer from TPG Capital and Leonard Green & Partners LP, a source familiar with the situation told Reuters on Sunday.

A spokeswoman for J Crew declined to comment to Bloomberg. The company could not immediately be reached for comment by Reuters outside regular U.S. business hours.

(Reporting by Sakthi Prasad in Bangalore; Editing by Mike Nesbit)