Ariana Research
Long/short equity, deep value, special situations

Ascena Retail Group: Leading Market Share And Aligned Management Below Its Private Market Value

Ascena Retail Group, Inc. (NASDAQ: ASNA)

Executive Summary

Ascena Retail Group, Inc. ("Ascena", "ASNA" or the "Company") is a leading retailer that holds a basket of brands focused on women's plus sized and tween categories. The Company has a market cap of $2.62B and an enterprise value of $2.56B. As of TTM 4/27/13, the Company generated $4.5B in revenues and $476.8MM in EBITDA, respectively.

The Company is attractively priced as the market is currently offering a proven retailer and acquisition platform with high inside ownership (~20%) that generates returns on invested capital in excess of 35% at 5.4x depressed EBITDA. Why does this opportunity exist? (1) integration issues and operational hiccups with the acquisition of Charming Shoppes have turned

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