Under the terms of the agreement, Madison Dearborn will pay about $1.4 billion in cash, or $34.75 per share, and take on $300,000 of the candle maker's debt. The Chicago-based buyer, which has acquired 16 other retail companies, specializes in buying out firms in the health care, packaging, consumer, financial services and communications industries.

The sale was the second in three years for Yankee Candle since New York-based buyout company Forstmann Little & Co. sold its holdings in the South Deerfield, MA firm to Goldman Sachs Group. Forstmann, which posted an almost five-fold return on the deal, paid $500 million to acquire a 90% share in Yankee Candle in April 1998.

Yankee Candle, which operates 409 stores in the US and is sold wholesale in more than 19,000 locations in North America and Europe, put itself on the block in July, eight months after announcing that it was closing stores, raising prices and slashing jobs in a bid to offset rising wax and energy costs that were burning into the company's profits. News of the sale came just a week after Yankee Candle's landlords, Candoff LLC and Candist LLC, announced it had sold the firm's South Deerfield headquarters and primary warehouse to a joint venture between AGC Equities LLC and Gumowitz Real Estate in an unrelated $33.6 million deal.