Apollo Global Management announced on Wednesday that it would acquire handicraft retailer Michaels in a deal that valued the company at $ 5 billion.
The acquisition is a bet that Michaels can continue to take advantage of the wave of enthusiasm for crafts spurred by Americans trapped at home during the pandemic. The company also invested in its digital business, starting with midday and same day delivery.
The shares of the retailer, which has more than 1,200 stores in North America and about 44,000 employees, increased nearly 300% last year, giving it a market capitalization of around $ 2.3 billion.
The deal will bring Michaels back into the hands of private equity, after seven years as a public company. Private equity firms Bain Capital and Blackstone acquired Michaels in 2006, making it private in a business of more than $ 6 billion. The company returned to public markets in 2014, with a market value of around $ 3.5 billion. Bain is still a large shareholder.
At least one other private equity firm has expressed an interest in acquiring Michaels, according to two people familiar with the situation.