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June 12 (Reuters) - Private equity firm Sycamore Partners on Thursday said it was interested in acquiring apparel retailer Express Inc, after disclosing a 9.9 percent stake that made it the largest shareholder in the company.
Express’s shares rose as much as 32.8 percent to $18.00 in extended trading. The stock closed down nearly 3 percent at $13.55 in regular trading on Thursday, valuing the company at $1.14 billion.
"We would like to perform confirmatory due diligence to determine a definitive valuation of the company," Sycamore said in a letter to the company's board. (link.reuters.com/huv99v)
The private equity firm said it would take 30 days to complete its due diligence, obtain financing commitments and submit its offer, according to a regulatory filing.
Express, which sells formal and casual wear as well as accessories at its stores, did not return calls seeking comment beyond regular business hours.
The company, formerly a division of L Brands Inc, last month cut its full-year earnings outlook and warned that it could post a loss in the current quarter due to high inventory and slow traffic.
Due to weak sales, the retailer plans to shut about 50 of its stores, which are located mostly in shopping malls, over the next 36 months.
If Sycamore buys Express, it will not be the first time the company will be owned by a private equity firm.
In 2007, Golden Gate took Express private and brought the company back on the market three years later.
Before Sycamore’s stake, Invesco Advisers Inc was the largest shareholder in Express with a stake of about 6 percent stake as of March 31, according to Thomson Reuters data.
The Vangaurd Group, Wellington Management Co LLP and BlackRock Institutional Trust Co are among Express’s other top shareholders.
Express shares have fallen 36.5 percent in the last 12 months. (Reporting by Shailaja Sharma in Bangalore; Editing by Savio D‘Souza)