Valinor scores on Gymboree deal…

October 14, 2010

After several weeks of rumors, Gymboree (GYMB) announced on Monday that it was being taken private by Bain Capital in a $1.8 billion deal. To be honest, we’ve been a fan of Gymboree ever since baby Soren was born. That’s because unlike a lot of the other clothes out there for baby boys, Gymboree clothes were actually interesting. We especially loved the rash guard with the skull and crossbones on it!

But judging by some recent filings, we weren’t the only fans of Gymboree. Valinor Management, the New York-based hedge fund was also a big fan. Weeks before rumors started circulating about the company being shopped around, Valinor filed this 13G disclosing a 5.6% stake in Gymboree. The filing notes that Valinor owned 1.52 million shares, which when compared with the most recent 13F filed on Aug. 13 was a significant increase over the 996,069 shares owned as of June 30. Indeed, a quick skim of Valinor’s 13Fs shows that the fund basically doubled down on Gymboree in successive quarters this year. At the end of March, it owned about 500,000 shares, according to its May 14 filing.

Of course, we don’t know the cost basis, so it’s hard to say how well Valinor did on this deal. (Perhaps if California candidate for Senate* Carly Fiorina gets her way there will be better transparency than the current non-disclosure disclosure available via 13Fs and 13Ds). Still, according to our friends at Insider Score, the Gymboree shares were Valinor’s second largest holding. We’ll go out on a limb here and guess that the whiff of a potential deal was much more attractive than the skull and crossbones rash guard.

*Correction: An earlier version of the post stated that Carly Fiorina was a gubernatorial candidate; however, she is actually running for a seat in the U. S. Senate. We regret the error.

Image source: Hello Ningbo

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