At Home Group Inc. Files Preliminary Proxy Statement

At Home Group Inc. (“At Home” or “the Company”) (NYSE: HOME), the home décor superstore, today announced that it has filed its preliminary proxy materials with the Securities and Exchange Commission (“SEC”) in connection with At Home’s pending transaction with funds affiliated with Hellman & Friedman (“H&F”), a premier global private equity firm. The preliminary proxy statement is available on the investor relations section of the Company’s website at investor.athome.com and the SEC's website at www.sec.gov.

As previously announced on May 6, 2021, under the terms of the H&F agreement, At Home stockholders will receive $36.00 in cash for each share of At Home common stock they hold in a transaction valued at approximately $2.8 billion, including the assumption of debt.

Highlights from the preliminary proxy filing include:

• Highly Attractive, Guaranteed Valuation and Premium. The H&F transaction delivers a significant premium of approximately 25% to the 30-day volume weighted average share price and delivers $36.00 per share in cash – a premium of approximately 17% to the Company’s closing stock price of $30.67 on May 4, 2021, the last trading day prior to media speculation regarding a possible transaction. It also:
  • Delivers a premium of approximately 29% to the 60-day volume weighted average share price and a premium of approximately 43% to the 90-day volume weighted average share price; and
  • Reflects a highly attractive Price-to-Earnings (P/E) multiple of fiscal year 2022 earnings – 18.7x At Home management’s 2022 earnings per share forecast and 22.3x the IBES consensus.

• Thorough and Robust Process, Which Led to Five Separate Price Increases. As the preliminary proxy statement describes in detail, the Company exhaustively explored a sale in the first half of 2019. Despite soliciting bids from financial sponsors and strategic buyers, and media speculation that the Company was exploring a sale, H&F was the only party to submit a bid. In December 2020, the Board formed a Special Committee of independent directors that also engaged independent financial and legal advisors. The value created by the transaction is the result of vigorous negotiations by the Special Committee of the Board, including:
  • The Special Committee’s negotiations with H&F led to five separate price increases from H&F’s initial bid of $32.00 per share to its final bid of $36.00 per share and favorable terms to At Home that the Board determined maximized value for all At Home stockholders.
  • As previously disclosed, the merger agreement also provides for a 40-day go-shop. As of June 1, 2021, Goldman Sachs, the Special Committee’s independent financial advisor, contacted 17 financial sponsors and 7 strategic parties pursuant to the go-shop. One of these parties has entered into a non-disclosure agreement with the Company but has not made any proposal to date. Each of the other parties declined to pursue a potential transaction involving the Company. Goldman Sachs has received no inbound inquiries from other third parties.

• Comprehensive Evaluation of the Company’s Long-Term Business Plan and Prospects. As part of their evaluation, the Special Committee and the Board carefully analyzed the value the Company is expected to derive from its standalone plan. Management’s five-year projections are detailed in the preliminary proxy statement.
  • Despite achieving record results for the first quarter of fiscal 2022, driven in part by a larger than expected U.S. federal stimulus tailwind, the Special Committee and the Board believed that the Company’s longer-term outlook through fiscal 2026 remained largely unchanged and that there are significant external risks to the Company’s business plan.
  • The risks include, but are not limited to, increased freight costs, potential changes in corporate tax rates and the federal minimum wage, risks to the Company’s supply chain, and the potential for a significant shift in consumer spending as the COVID-19 pandemic eases. The Special Committee and the Board also considered the operating costs for planned new store openings, which may not be achievable, as well as the associated margin headwind.
  • The Special Committee and the Board considered that the Company would need to meet or exceed the business plan and achieve a multiple at which At Home as a public company has not seen on a consistent basis since early 2019 in order to generate significantly greater value through execution of its standalone strategy, while remaining subject to the external risks and uncertainties inherent in the business plan, as compared to the certain, immediate, and liquid all cash value of $36.00 per share offered by the proposed H&F transaction.

The At Home Board of Directors and Special Committee unanimously believe this transaction is the optimal path forward and in the best interest of its stockholders.