Rent-A-Center has agreed in principle to settle all litigation with Vintage Capital Management, and B. Riley Financial relating to the company’s termination of an agreement and plan of merger last year with certain affiliates of Vintage Capital.
In the settlement, Rent-A-Center will receive a payment of $92.5 million in cash. The parties have agreed to enter into a definitive settlement agreement by April 25, 2019 and that the amount due to Rent-A-Center will be paid within 28 days thereafter. In connection with the settlement, Rent-A-Center said it will exchange mutual releases with all other parties with respect to all matters relating to the merger agreement, including its termination.
After payment of all remaining costs, fees and expenses of Rent-A-Center relating to the terminated merger agreement and arising from the settlement of the litigation, it expects to retain pre-tax proceeds of approximately $80 million.
Mitch Fadel, CEO of Rent-A-Center, said, “We are pleased to finally conclude this matter, avoiding further litigation and providing certainty regarding the payment of the termination fee. We look forward to turning our sole and undivided attention to executing our strategic plan focused on growing our business and enhancing value for our stockholders.”