Retailer Rent-A-Center Inc was within its rights to back out of a $1.36 billion merger deal with private equity firm Vintage Capital Management last year, a Delaware state court ruled Thursday.
Vice Chancellor Sam Glasscock III of the Delaware Chancery Court said that Vintage’s failure to inform Rent-A-Center that it was extending the merger deal by an agreed-upon date triggered Rent-A-Center’s right to call it off under the two parties’ contract.
Rent-A-Center is a “rent-to-own” business, allowing customers to rent furniture, electronics and other goods with the option of eventually purchasing them.
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