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12/19/2018

Vintage Capital says Rent-A-Center buyout deal is still in play

Rent-A-Center hasn't cut ties with Vintage Capital Management just yet.

According to private equity firm Vintage Capital, Rent-A-Center’s announcement that its pending merger agreement has been called off is “invalid.”

“Vintage believes that the merger agreement remains in effect and that Rent-A-Center’s actions constitute a further material breach of the merger agreement. Vintage intends to pursue all available remedies against Rent-A-Center,” the private equity firm said in a statement.

On Dec. 18, Rent-A-Center announced that it had terminated a deal to be acquired by affiliates of Vintage Capital after the private equity firm didn’t extend the deal’s deadline. The agreement had allowed Rent-A-Center and Vintage Capital to extend the end date of the plan of the merger to March 17. Rent-A-Center also opted not to extend the end date.

Vintage Capital is the controlling shareholder of one of Rent-A-Center’s biggest competitors, Buddy’s Home Furnishings. The deal, which was announced in June and approved by shareholders in September, was valued at about $1.37 billion including debt.

Rent-A-Center owns approximately 2,400 stores in the United States, Mexico, Canada and Puerto Rico, and approximately 1,250 Acceptance Now kiosk locations in the United States and Puerto Rico. Rent-A-Center Franchising International, a wholly owned subsidiary of the company, is a national franchiser of approximately 250 rent-to-own stores operating under the trade names of “Rent-A-Center,” “ColorTyme,” and “RimTyme.”