Private Equity Firms File For Michaels Stores IPO (MIK, BX)

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Michaels Stores, Inc. has just filed its paperwork with the Securities and Exchange Commission to come public again via an initial public offering.  Todays move confirms recent reports and speculation that private equity firms were looking to bring this portfolio company (and many others) back as public companies.  The company is the largest arts and crafts specialty retailer in North America and the company even claims to have approximately as many stores as its two largest direct competitors combined.

No terms were listed other than that the company intends to sell up to $500 million in common stock.  Michaels intends to list on the New York Stock Exchange under the stock ticker “MIK.”

The underwriting group is huge: J.P. Morgan; Goldman, Sachs & Co.; Barclays; Deutsche Bank Securities; BofA Merrill Lynch; Credit Suisse; Morgan Stanley; and Wells Fargo Securities.

If you will recall, Michael’s was taken private in a deal valued at $6 billion back in 2006 during the private equity craze.  Private equity backers and owners include affiliates of Bain Capital, The Blackstone Group L.P. (NYSE: BX); and Highfields Capital Management.

The retailer shows in its filing that it has 1,196 stores that consist of 1,066 Michaels Stores and 130 Aaron Brothers stores.  Sales were up 4.4% to $4.2 billion in 2011 over 2010 sales and same-store sales were up 3.2%.  The company also posted sales growth of 3.7% in 2010 over 2009 on comparable sales growth of 2.5%.  During fiscal 2011, Michaels achieved operating income of $569 million, a gain of 16.6% from fiscal 2010 which was 22.9% higher than fiscal 2009.

JON C. OGG

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