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Yankee Candle In $1.7B Buyout

SOUTH DEERFIELD, MA-A Chicago buyout firm has agreed to acquire the Yankee Candle Co. for $1.7 billion.

By Beverly Ford | Updated on October 26, 2006

SOUTH DEERFIELD, MA-Scented candle maker Yankee Candle Co. will be sold for $1.7 billion to the private equity firm Madison Dearborn Partners LLC in a deal that sent the candle maker’s stock soaring 17% to its highest level this year. The acquisition, which still must be approved by Yankee Candle shareholders, is expected to close early next year, the company says.

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.

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