On Tuesday, Rent-A-Center, Inc. (NASDAQ: RCII) shares increased when they revealed that they had received and rejected a bid from a private investor for $15 per share totaling to about $800 million. A private equity firm based in Orlando called Vintage Capital Management sent an unsolicited proposal to buy all shares of Rent A Centers’ common stock on June 20, 2017. Rent A Center formally rejected this offer on July 5 resulting in increasing shares by 10% on Tuesday morning.
Rent A Center’s board of directors determined that Vintage’s proposal would significantly undervalue the company deeming it to be inadequate and opportunistic. Rent A Center declared that they would be better off executing another plan on their own. This includes growing online sales and its Acceptance Now unit business which provides financing for customers to buy furniture and electronic goods. Already, these initiatives are delivering a lot of progress in key performance metrics.