Restoration Hardware dissidents seek to block buyout
Tom Edmonds -- Furniture Today, May 20, 2008
San Diego – A group of Restoration Hardware shareholders opposed to the specialty retailer’s acquisition deal with Catterton Partners will get their hearing, as Marin County Superior Court judge Lynn O’Malley Taylor ordered a hearing be held June 11 to air their efforts to enjoin the proposed buyout.
The private equity buyout of the Corte Madera-based, $713 million (2006) retailer is slated to close during the second quarter of 2008.
Attorneys for the plaintiffs said the action “alleges breach of fiduciary duty in connection with the decision of the Restoration Hardware board to sell the company to [ceo Gary] Friedman and Catterton for $4.50 per share.”
Counsel representing the plaintiffs are San Diego-based Coughlin Stoia Geller Rudman & Robbins LLP and The Weiser Law Firm.
“Shareholders will be asking the court to enjoin certain contractual provisions that preclude Sears Holdings from taking its proposal directly to Restoration Hardware’s shareholders,” the attorneys said.
Sears Holdings had made a final offer of $4.55 per share, but Restoration Hardware management determined in March the Sears offer “was not reasonably likely to result in a superior proposal under the terms of the [Catterton] agreement and plan of merger because, among other considerations, the proposal was subject to significant uncertainties” compared to the Catterton bid.
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