A deal to take off-price fashion retailer Stein Mart private has been terminated in response to the unpredictable economic conditions resulting from the coronavirus pandemic.
Stein Mart and Kingswood Capital Management say they have mutually agreed to end the merger, which would have seen an affiliate of Kingswood acquire all of the outstanding common stock of Stein Mart not already owned by affiliates of Jay Stein, Stein Mart’s former CEO and current chairman of the board of directors, and related investors. The deal was first announced on 31 January.
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By GlobalDataThe decision is in response to the unpredictable economic conditions resulting from the coronavirus (Covid-19) pandemic, uncertainty regarding Stein Mart’s ability to satisfy the conditions to closing, and the substantial expense to Stein Mart of soliciting shareholder approval for a transaction that is unlikely to close.
Neither party will be required to pay the other a termination fee as a result of the mutual decision.
In its most recent financial results, Stein Mart reported a net loss of US$0.3m for the fourth quarter ended 1 February, compared to net income of $3.7m last year. Net sales declined to $336.6m from $340.8m for the fourth quarter of 2018.
