An Orlando private equity firm attempting to buy rent-to-own giant Aaron’s has rescinded its takeover bid of $2.3 billion, just two days after Aaron’s board said it was rejecting the offer.
In a letter to Aaron’s directors released Thursday, Vintage Capital Management said it was dropping the action in part because of Aaron’s announcement Tuesday that it had acquired Progressive Finance, an online lender, for $700 million.
During the announcement of the Progressive acquisition, Aaron’s also said it was rejecting Vintage’s bid, calling the firm’s offer of $30.50 per share “inadequate” and “illusory.”
“Your decision to reject our offer and instead spend $700 million on the acquisition of Progressive Finance without any input from shareholders appears to be a desperation move designed to do nothing but block our offer,” Vintage said in its letter to directors. “Aaron’s does not need Progressive Finance and the $426 million in new debt incurred to finance the acquisition—it needs new directors who will install a new management team.”
The letter also addressed the firm’s willingness to pay a higher price for the company.
“We have also urged you to consider in good faith our offer to acquire Aaron’s for $30.50 per share in cash, and explicitly stated that following due diligence we could be prepared to pay an even higher price.”
About the Author
