Key takeaways:
- WHP Global has proposed to acquire Guess Inc. at $13 per share.
- The offer reflects a 34% premium over the company’s share price prior to the announcement.
- Guess has formed a special committee to review the proposal, which is subject to further negotiations and assessments.
Introduction
On March 17, 2025, apparel retailer Guess announced that it received a non-binding take-private offer from WHP Global priced at $13 per share. This offer is notably a 34% premium compared to Guess’s closing share price of $9.70 on March 14, indicating a potential significant upside for investors. The deal, valued at approximately $751.5 million, aims to purchase all outstanding shares excluding those owned by co-founders and the CEO.
Detailed Analysis
The proposal from WHP Global aims to acquire Guess’s outstanding shares, a notable move given the co-founders Paul and Maurice Marciano, and CEO Carlos Alberini together own a substantial stake, approximately 43% of the company. Their continued investment would place them in a unique position within the proposed structure, effectively maintaining their influence in the brand’s operations while transitioning the company into the private sector.
The WHP proposal enhances the allure for investors, with Guess shares surging by approximately 31% in early trading following the announcement, highlighting market enthusiasm about the acquisition. The current valuation suggests WHP Global recognizes the underlying value of Guess, especially amidst challenges the brand has faced in recent quarters.
In a strategic context, WHP Global is not new to Guess; the two companies collaborated last year to acquire the intellectual property and operational assets of the designer handbag label Rag & Bone, positioning themselves to enhance brand synergy and operational expertise. This prior collaboration suggests a foundation of trust and mutual benefit, potentially smoothing the transition should the acquisition move forward.
As part of its due diligence, Guess has established a special committee of independent directors along with the engagement of external financial and legal advisors to evaluate WHP’s proposal. This step is crucial for ensuring that all stakeholders’ interests, particularly minority shareholders, are scrutinized effectively. Moreover, the company has cautioned that there is no guarantee of a deal proceeding.
Conclusion
This take-private offer by WHP Global presents a significant opportunity for current investors in Guess Inc. An acquisition, if finalized, may provide a more stable foundation for the brand to navigate challenges in the competitive retail landscape. Investors should closely watch the developments of this proposal as its outcome could lead to substantial changes in Guess’s operational strategy and financial structure in the coming months.
References
1 Apparel retailer Guess gets take-private offer from WHP Global. Reuters. Retrieved March 17, 2025.
2 Guess?, Inc. Receives Going-Private Proposal from WHP Global. Business Wire. Retrieved March 17, 2025.
3 Guess Gets Offer to Be Taken Private by WHP Global for $13/Shr. MarketWatch. Retrieved March 17, 2025.
Tags: Guess Inc., WHP Global, take-private offer, retail investment
