SCHEDULE 13D/A: WHP Global Proposes $13 Per Share Take-Private Bid for Guess?, Inc.; Marciano Brothers to Roll Over Shares

WHP Global has submitted a non-binding proposal to acquire Guess?, Inc. for $13.00 per share in cash, with key shareholders Paul Marciano, Maurice Marciano, and Carlos Alberini expected to roll over their equity.

Summary

• WHP Global, through its affiliate WHP Investments, LLC, submitted a non-binding proposal to the Board of Directors of Guess?, Inc. on March 13, 2025.
• The proposal aims to acquire all outstanding shares of Common Stock, except those held by Paul Marciano, Maurice Marciano, and Carlos Alberini, for $13.00 per share in cash.
• A key condition of the Proposed Transaction is that Paul Marciano, Maurice Marciano, and Carlos Alberini would rollover all of their shares or reinvest their cash proceeds.
• The proposal is conditioned upon the formation of a Special Committee of fully independent and disinterested directors, empowered to negotiate at arm's length and recommend the proposal.
• WHP Global stated that it would not proceed with the Proposed Transaction unless it is negotiated with and recommended by the Special Committee.
• The Proposed Transaction is not subject to a financing condition.
• Paul Marciano, the reporting person, currently holds 19,501,840 shares, representing 37.6% of the Common Stock, and has engaged in preliminary discussions with WHP Global.
• Paul Marciano's support for the Proposed Transaction is contingent on his ability to rollover all his shares, the transaction not being subject to a 'majority of the minority' approval, and negotiation/recommendation by a Special Committee.
• Paul Marciano has not entered into any definitive agreement and intends to remain a long-term stockholder regardless of the proposal's outcome.

Sentiment

Score: 7

Explanation: The document presents a significant corporate development with a specific cash offer, which could be positive for shareholders seeking liquidity. The absence of a financing condition is also a positive. However, the proposal is non-binding, subject to various conditions, and carries inherent uncertainties regarding its completion and final terms, preventing a higher score.

Positives

• The proposal offers a potential cash exit for non-rollover shareholders at a specified price of $13.00 per share.
• The Proposed Transaction is not subject to a financing condition, reducing a common risk associated with such deals.
• The involvement of a Special Committee of independent directors is intended to ensure an objective and independent review process.

Negatives

• The proposal is non-binding, meaning there is no assurance that a definitive agreement will be reached or that the transaction will occur.
• Paul Marciano's conditions for support, including the absence of a 'majority of the minority' approval requirement, could be viewed negatively by some minority shareholders.
• The potential delisting of Common Stock from the New York Stock Exchange would remove public trading liquidity for shareholders.

Risks

• There is no assurance that the non-binding proposal will result in any definitive agreement, transaction, or strategic alternative.
• The terms of the Proposed Transaction, including the per-share price, may change during negotiations.
• The Proposed Transaction could lead to an acquisition of additional securities, an extraordinary corporate transaction (such as a merger), delisting of the Common Stock, or other material changes in the Issuer's business or corporate structure.
• Paul Marciano may accelerate or terminate discussions with WHP Global and/or the Special Committee at any time, or change his intentions regarding the proposal.

Future Outlook

The document outlines a potential future take-private transaction for Guess?, Inc. initiated by WHP Global, which could lead to the acquisition of additional securities, a merger, delisting from the NYSE, and other material changes to the Issuer's business or corporate structure. However, there is no assurance that any definitive agreement will be reached or that the transaction will ultimately occur, as it is non-binding and subject to ongoing negotiations and conditions.

Management Comments

• Paul Marciano conveyed to WHP Global that he currently would not support any Proposed Transaction unless he is permitted to rollover or reinvest all of his shares of Common Stock.
• Paul Marciano also conditioned his support on the Proposed Transaction not being subject to the approval of a 'majority of the minority' of the Common Stock.
• Paul Marciano requires the Proposed Transaction to be negotiated at arm's-length with, and recommended to the Board by, a Special Committee.
• Paul Marciano intends to engage in discussions with WHP Global and the Special Committee regarding the transactions contemplated by the Proposal.
• Paul Marciano does not intend to engage in discussions concerning potential transactions involving the Issuer with persons other than WHP Global at this time.
• Paul Marciano intends to remain as a long-term stockholder, regardless of the outcome of the Proposal.

Industry Context

The proposal for a take-private transaction aligns with a broader trend where public companies, particularly in mature sectors like retail/fashion, opt to go private to escape public market pressures, reduce regulatory compliance costs, and pursue long-term strategic initiatives without quarterly scrutiny. Such moves often involve existing management or founders retaining a significant stake, as seen with the Marciano brothers and Carlos Alberini.

Comparison to Industry Standards

• NA. This document details a specific non-binding take-private proposal and Paul Marciano's beneficial ownership and intentions. It does not contain financial performance metrics or operational results that would allow for direct comparison to industry standards, global benchmarks, or specific comparable companies' financial outcomes.

Corporate Governance

Related Party Transactions

• Paul Marciano, Maurice Marciano (Paul's brother), and Carlos Alberini (CEO of Guess?) are identified as existing shareholders who would be required to rollover all of their shares of Common Stock or reinvest all of their cash proceeds from the Proposed Transaction as a condition of WHP Global's proposal.

Stakeholder Impact

• Shareholders: Non-rollover shareholders could receive $13.00 per share in cash, providing liquidity. Rollover shareholders (Paul Marciano, Maurice Marciano, Carlos Alberini) would maintain an equity stake in the private entity.
• Employees: While not explicitly detailed, a take-private transaction could lead to changes in corporate strategy, operations, and potentially workforce structure as the company transitions from public to private ownership.
• Management: Key management (Marcianos, Alberini) would continue their involvement and equity ownership, potentially with greater flexibility away from public market pressures.
• Company: Transition to private ownership would alter reporting requirements, corporate governance, and strategic decision-making processes, potentially allowing for longer-term investments and strategic shifts.

Next Steps

• Formation of a Special Committee by the Board of Directors to consider the Proposed Transaction.
• The Special Committee, advised by independent legal and financial advisors, will objectively and independently consider the Proposed Transaction, including negotiating with WHP Global and the Marciano brothers/Alberini.
• Paul Marciano intends to engage in discussions with WHP Global and the Special Committee regarding his participation in the transaction.
• Potential execution and delivery of definitive transaction documentation with the Issuer and/or WHP Global.

Key Dates

Recommendation

Keywords

Guess Inc, WHP Global, Paul Marciano, Take Private, Schedule 13D, Common Stock, Shareholder Proposal, Corporate Acquisition, Equity Rollover, Special Committee, NYSE Delisting, Beneficial Ownership