Wilson's Advisers Test Waters For Lululemon Buyout - Update

(RTTNews) - Advisers to Lululemon Athletica Inc (LULU) founder Dennis "Chip" Wilson have been testing the waters over taking the Canadian yogawear maker private.

A Wall Street Journal report said the advisers have been "sounding out" private-equity firms including Leonard Green & Partners, even as no concrete deal to take the company private is in the offing.

The move assumes significance as Wilson actively explores options, and seeks to exert more influence over Lululemon's operations.

Recently, Wilson was said to have been eying a shake up of the Lululemon board to gain more influence over the how the company is run. Wilson, with a 28 percent stake in Lululemon, has differences with the board, and wants the company to have product development a top priority.

Wilson has been reportedly working with Goldman Sachs as he weighs options for the company including getting additional seats on the board or team up with a private equity in a buyout. Lululemon has a market capitalization of about $6 billion.

Wilson founded Lululemon in 1998, relinquished his role as CEO in 2005, and in May, stepped down as chairman. He remains a director, however.

The company's shares have shed about 30 percent in value this year. Its reputation was hurt after customers, last year, complained that some of their black yoga pants being too sheer, forcing the company to embark on a costly recall.

Last month, Lululemon said its first-quarter profit more than halved despite higher revenues.

LULU closed Wednesday at $41.40, up $1.13 or 2.81%, on a volume of 2.5 million shares on the Nasdaq.