Two Private Equity Firms May Bid for BJ's Wholesale Club
Private-equity firms Leonard Green & Partners and CVC Capital Partners plan to team up on a joint buyout bid to acquire BJs Wholesale Club (NYSE:BJ) for at least $2.8 billion, according to the New York Post.
News of the potential offer sent shares of the Westborough, Mass.-based warehouse retailer more than 2% higher Wednesday morning.
The reported minimum offer price represents about a 7% premium over BJs closing market value on Tuesday.
Earlier this year BJs selected Morgan Stanley (NYSE:MS) to run its auction process, drawing interest from a number of parties.
While CVC and Leonard Green near a deal for BJs, big private-equity firms Bain Capital and Apollo Global Management (NYSE:APO) have reportedly dropped out of the running.
Major bidders walked away from the auction "not because it's a bad asset, but because they didn't feel they could compete with Leonard Green, a source told the Post.
Formed in 1989, Los Angeles-based Leonard Green has invested in 36 companies with aggregate value of $25 billion, including retailers like J. Crew, Petco, Rite Aid (NYSE:RAD) and Whole Foods.
Leonard Green and CVC have close ties of late, teaming up on an investment in Leslies Swimming Pool last year and then again in May to bid on Big Lots (NYSE:BIG), the Post reported.
Boosted by the buyout talk, shares of BJs climbed 2.10% to $48.68, leaving them down just 0.4% on the year.