Restoration of a Deal

Restoration Hardware Inc. (Corte Madera, Calif.) has announced it has entered into an amended merger agreement with affiliates of Catterton Partners Corp, a Greenwich, Conn.-based private equity investor.

Under the terms of the amended agreement, most of the retailer’s outstanding shares will be acquired for a total equity value of approximately $179 million.

Catterton, with more than $2 billion under management, includes in its portfolio such retailers and brand marketers as Breyers Yogurt Co., Build-A-Bear Workshop, Cheddar's Restaurant Holdings, Outback Steakhouse, P.F. Chang's China Bistro, Baja Fresh Mexican Grill and Frederic Fekkai.

Restoration Hardware, a once-thriving specialty home-furnishings chain that had fallen on hard times, was believed to be heading for a merger with Sears Holdings Corp. (Hoffman Estates, Ill.), although Catterton began negotiating for a buy-out in November 2007. It’s not clear whether Sears, which already owns 13.7 percent of Restoration Hardware, has taken itself out of the game, or where it will stand if the Catterton buy-out is approved by the other Restoration Hardware stockholders. Sears original offer had been for $269 million, but Restoration Hardware initially rebuffed Sears’ offers. At the time, Catterton’s competing offer was $267 million.