Collective Brands Inc. (PSS:US) jumped to a 10-month high after South Korean clothing company E-Land Group said it will bid for the owner of the Payless ShoeSource chain.
“E-Land seeks to buy Collective Brands,” Ro Byung Gyoo, a spokesman for E-Land Group, said by phone today. He declined to give details of the offer, including its price. Collective Brands rose 8.9 percent to $20.09 at 10:19 a.m. in New York, after reaching $20.19, the highest intraday price since May. The stock has climbed from a close as low as $9.35 in August.
Maeil Business Newspaper earlier reported that E-Land Group is preparing a $1.8 billion joint offer for the company with institutional investors such as National Pension Service and Korea Development Group. Mardi Larson, a spokeswoman for Topeka, Kansas-based Collective Brands, declined to comment on the Maeil report and didn’t immediately return a phone message left today. today that the company is preparing a $1.8 billion joint offer.
Acquiring Collective Brands would help E-Land reach its target of 6 trillion won ($5.3 billion) from footwear sales by 2015, 5 trillion won of which would come from outside South Korea, according to Maeil.
Collective Brands, which also makes Saucony and Sperry Top- Sider shoes, said in August that it would work with Perella Weinberg Partners and Kurt Salmon to explore strategic options. Last month, the company winnowed the pool of potential buyers to about 10, people familiar with the matter said at the time.
Much of Collective’s growth has come in Asia, with the company last month announcing plans to open its first Payless stores in Vietnam, Thailand and Korea.
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