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Private equity-owned J. Crew Group Inc reportedly in talks with Fast Retailing Co for possible sale

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March 1
1:33 PM 2014

Two sources told Bloomberg that retailer J. Crew Group Inc is talking with Fast Retailing Co for a possible sale. The talks with the retailer owned by TPG Capital and Leonard Green & Partners and the Uniqlo owner are still in the early stages. The people spoke on the condition of anonymity because of the confidentiality of the matter, the report said.

A Reuters report on the matter, which also cited sources, also said that South Korea-based fashion firm E. Land Group was also thinking of examining a possible deal with J. Crew, according to sources. According to one of the people interviewed by Reuters, the US-based apparel chain, which TPG Capital and Leonard Green took J. Crew private in 2011 in a $2.8 billion deal, should have a price tag of no less than $5 billion in the event of a sale. Another source added that E. Land is discussing with possible partners so it can make a joint offer for J. Crew.

According to the Reuters report, it was the Wall Street Journal that broke the news about the overture made by Japanese retailer Fast Retailing this week to J. Crew's management about its intention to buy the company.

Two other people also told Bloomberg that Advent International Corp, a buyout firm, is also setting its sights on the retailer. Earlier this week, two sources also said that J. Crew was mulling an IPO sometime later in 2014, the report said.

For RetailSystems Research Managing Partner Paula Rosenblum, what's important for the retailer is to get money for its growth plans. She told Bloomberg in an interview, "They're hot, and they obviously want to expand more so they're looking for capital. The debate of whether to go public or resell to somebody else is endless. Drexler does know the public markets, he's been there before." J. Crew is headed by its Chief Executive Officer Millard "Mickey" Drexler, the report said. 

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