Private Group to Buy Brookstone for About $445M

Specialty retailer Brookstone Inc. (search) Friday said it agreed to be acquired and taken private by a consortium led by Singapore-based OSIM International (search) for about $445 million, the latest U.S. retailer to change hands.

The consortium, which also includes private equity firm JW Childs Associates LP (search) and Temasek Holdings (Private) Ltd. of Singapore, will pay $20.50 per share in cash for Brookstone, known for collections of unusual gadgets, tools, sports products and gifts.

Merrimack, N.H.-based Brookstone operates 288 branded stores in the U.S. and Puerto Rico, five Gardeners Eden stores and a catalog business. It generated sales of $499 million with record profit of $21.4 million in 2004.

Brookstone is the latest in a spate of retailers to be sold to buyers that often include private equity funds hungry both for real estate holdings and retail operations.

Toys R Us Inc. (TOY) for instance, agreed last month to be sold to a buyout group for $6.6 billion, while Shopko Stores (SKO) agreed last week to be sold to a buyout firm for $715 million.

Earlier this year, Federated Department Stores Inc. agreed to buy rival May Department Stores , while Neiman Marcus Group said on March 16 that it is considering selling itself.

Brookstone shares surged on the announcement, recently trading up 27.7 percent to $19.93, up $4.33.

Brookstone had an average of 21.1 million diluted common shares outstanding in the 13 weeks to Jan. 29, according to regulatory filings, which would put the value of the deal at $432 million. A company spokesman said the deal also includes the purchase of restricted shares, bringing the value to $445 million.

Brookstone said all senior management will remain in place following the acquisition. The deal is expected to be completed in the second or third fiscal quarter, it said.

Goldman Sachs advised the buyers, while CIBC World Markets advised a Brookstone board committee.