Rent-A-Center Shares Explode on Buyout News

Shares of Rent-A-Center saw a 22% single day breakout on Monday after it was revealed that Vintage Capital will pay $15 a share in cash for the company.

Both companies announced that the acquisition is anticipated to close by the end of 2018.

Including debt, the deal is valued at roughly $1.37 billion.

According to Rent-A-Center’s CEO Mitch Fadel, the news, “reflects the significant progress we have made to materially improve our performance and would not have been possible without the hard work and focus of our talented co-workers over the last several months.”

“Vintage is a natural partner for Rent-A-Center given its deep knowledge of the rent-to-own industry, and we look forward to partnering with them to realize the full benefits of the transaction,” he added.

“We believe that the combination of Rent-A-Center, Buddy’s and Vintage is a compelling opportunity to utilize our resources and expertise to enhance value and create a leader in the rent-to-own industry,” stated Brian R. Kahn, managing member and founder of Vintage Capital and chairman of the board of Buddy’s.

A Rent-A-Center spokesman also said, “We are confident this transaction provides growth and development opportunities for many Rent-A-Center co-workers.”

Disclaimer: We have no position in Rent-A-Center Inc. (NASDAQ: RCII) and have not been compensated for this article.