Denim deal: True Religion — which counts stars likeMegan Fox as fans — has agreed to sell the upscale denim brand founded by Jeffrey Lubell (pictured) to TowerBrook Capital Partners for $835M. (Getty Images)
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True Religion has finally found a savior.
The upscale denim brand — which hired Guggenheim Partners in October to explore strategic alternatives — said yesterday it has agreed to a buyout offer worth $835 million from TowerBrook Capital Partners.
The offer of $32 a share represents an 8.7-percent premium to True Religion’s Thursday closing stock price of $29.44. The shares yesterday rose 8.1 percent, to $31.82.
As reported by The Post, an auction for the jeans maker stalled in March, as prospective buyers including Gores Group and Sycamore Partners balked on price.
At the time, True Religion was asking for as much as $34 a share to close a deal, according to sources. Bidders, meanwhile, were dug in closer to $30 a share, betting that a lackluster economy eventually would drag the price down.
Indeed, True Religion yesterday reported a first-quarter profit of 22 cents a share, falling short of Wall Street’s forecast of 34 cents a share. Sales rose 13 percent, to $120.8 million.
The Vernon, Calif., company has struggled in recent years as founder Jeffrey Lubell refused to cut prices on the company’s notoriously expensive jeans, which sell for upward of $300 a pair.
Meanwhile, rivals including VF Corp.’s Seven For All Mankind and J Brand have flooded the market with jeans below $200 a pair.
In March, Lubell stepped down as chairman, CEO and creative director after the company’s board declined to renew his contract. He was instead named chairman emeritus and creative consultant.
Lubell, who began embellishing jeans as a teenager in New York, founded True Religion in 2002 and took it public a year later. The brand operates 124 stores in the US and 31 overseas.