Discovery Group Sends Letter to Kellwood's Board of Directors Urging Negotiations with Sun Capital
17 Janeiro 2008 - 3:35PM
Business Wire
Discovery Group, LLC (�Discovery Group�), a 1.5% shareholder in
Kellwood Company (NYSE: KWD) (�Kellwood�), today announced that it
has sent a letter to the Board of Directors of Kellwood expressing
support for Sun Capital�s recently commenced tender offer to
purchase all outstanding shares of Kellwood common stock for $21.00
per share in cash. The full text of the letter, sent yesterday,
follows: January 16, 2008 Board of Directors Kellwood Company c/o
Mr. Robert Skinner, Jr. Chairman and Chief Executive Officer 420
5th Avenue 28th Floor New York, NY 10018 Dear Directors: Discovery
Group is a beneficial shareholder of 391,100 shares of Kellwood
stock, representing 1.5% of outstanding shares. Discovery Group is
a institutional money manager with a focus on investing in
undervalued small capitalization stocks. We have made multiple
successful investments in the apparel and retailing sector and we
have been familiar with Kellwood for several years. We are also
familiar with Sun Capital Partners. We are contacting the Board to
notify you of our position with respect to the offer Kellwood has
received from Sun Capital. Sun�s offer of $21.00 per share provides
immediate liquidity and a handsome premium to shareholders at a
fair valuation for the Company. We strongly believe that the Board
must negotiate in good faith with Sun in order to strike the best
possible transaction for all shareholders. A negotiated transaction
with Board approval will be more expeditious and productive than a
contested takeover. Should the Board decide not to structure a
friendly transaction, we as shareholders feel strongly that the
Board must rescind its poison pill and any other defense
mechanisms. By doing so, the Board will allow shareholders to
decide for themselves whether to accept Sun�s $21.00 or to maintain
the status quo. Discovery currently intends to submit our shares to
the Cardinal Integrated (SCSF and Sun Capital) Tender Offer. Best
Regards, /s/ Michael R. Murphy Michael R. Murphy Managing Partner
About Discovery Group Discovery Group is a Chicago-based merchant
banking firm that manages private partnerships in specialized
investment strategies. Discovery Group manages approximately $200
million in assets. Discovery Group's affiliated funds maintain
portfolios that are concentrated in publicly-traded small
capitalization companies, with ownership stakes that may reach 20%
of a particular company's outstanding shares. Investment candidates
are initially identified based on statistical criteria that suggest
a discrepancy between public trading value and fundamental economic
value. Investors in these funds include several large university
endowments, nationally-recognized charitable foundations and a
variety of trusts, family offices and wealth advisors.
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