KarpReilly drops bid for Charlotte Russe

By Lisa Kerner

Charlotte, N.C., Nov. 2 - KarpReilly Capital Partners, LP and H.I.G. Capital, LLC withdrew their proposal to pursue an acquisition of Charlotte Russe Holdings, Inc. after the company denied their request for access to due diligence material, according to a schedule 13D/A filed with the Securities and Exchange Commission.

Charlotte Russe's board of directors had already unanimously rejected the unsolicited proposal from the investors to acquire the company for between $9.00 and $9.50 per share.

It was previously reported that KarpReilly and H.I.G. said they were considering a lower valuation of Charlotte Russe following discussions with fellow shareholders and the release of the company's financial results for fiscal quarter and year ended Sept. 27.

KarpReilly said in order to offer $9.00 to $9.50 per share for the San Diego specialty retailer, it will "need to understand the causes of the shortfall in the reported earnings for the fourth quarter of fiscal year 2008 and evaluate the key assumptions leading to the severe erosion of the expected earnings for the first quarter of fiscal year 2009."

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