Golden Gate Capital Acquires J. Jill

Golden Gate Capital has agreed to acquire the women's apparel and accessories retailer J. Jill from Talbots (NYSE, TLB) for $75 million. As part of the deal J. Jill will close about 25% of its stores but keep its headquarters and distribution facilities. Talbots acquired the brand in 2006 for $517 million but after a couple of years of over-expansion and mismanagement recently valued it at only $16 million and said the unit had an operating loss of $76 million last year.

Private equity firms have acquired 70 apparel and accessories companies since the beginning of 2006, according to the PitchBook Platform. Golden Gate was the most active investor during the period with four completed acquisitions, followed by Sun Capital Partners with three. The current downturn has been hard on clothing companies with many suffering steep declines in sales and profits. The lack of love for the sector extends to private equity, which has only acquired two companies so far in 2009 compared to 25 last year. Buyout investors are continuing to wait for consumer spending to find a bottom and valuations of the companies to fall.