Charlotte Russe evaluating sale of company
today Jan 21, 2009
* Says considering possible sale of company
* Shares up 19 pct
* Q1 loss/shr 7 cents vs. EPS est of 11 cents
* Sees Q2 loss
Jan 21 (Reuters) - Women's-apparel retailer Charlotte Russe Holding Inc (CHIC.O) said it is evaluating a number of strategic alternatives, including a possible sale of the company, and has received "potential expressions of interest from third parties."
The company also posted a surprise quarterly loss and forecast a second-quarter loss that was wider than market estimates.
In November, Charlotte Russe had received a buyout offer from its shareholder KarpReilly Capital Partners LP, which had offered to take the retailer private in a deal valued at about $198.6 million.
But the offer was withdrawn a few days later, after the company denied the shareholder's request for access to due diligence material.
The company is being given financial counsel by Cowen and Co LLC, while Covington & Burling LLP and Cooley Godward Kronish LLP are providing legal counsel.
Charlotte Russe, which sells apparel and accessories targeting young women in their teens and twenties, expects a loss of 10 cents to 20 cents a share for the second quarter, against analysts' average estimate of a loss of 7 cents a share.
The retailer, which competes with Abercrombie & Fitch Co (ANF.N) and Hot Topic Inc (HOTT.O), also expects sales trends to remain soft in the second quarter amid a weak economic environment, the Easter shift and the seasonality of its business model.
Shares of the San Diego, California-based company were trading at $5.89 in after-hours trade, after closing at $4.93 Tuesday on Nasdaq. (Reporting by Nivedita Bhattacharjee in Bangalore; Editing by Pratish Narayanan)
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