NEW YORK CITY-Apparel retailer J.Crew Group Inc., headquarteredhere, said Tuesday it has agreed to a buyout by a partnership ofSan Francisco-based TPG Capital and Leonard Green & Co., basedin Los Angeles. The deal is valued at approximately $3 billion, or$43.50 per share, a 29% premium on the retailer’s average closingshare price last month. Millard Drexler will continue as J.Crew’schairman and CEO and maintain a "significant equity investment,"the company says.

Under terms of the agreement, a committee of J.Crew directorscan shop around for alternative proposals through January 2011, a“go shop” period that would reflect the retailer’s holiday salesperformance. If the process does not result in a better offer, theTPG/Leonard Green deal is expected to close in the first half ofnext year.

“As I have always said, we are in this for the long term and wedo what we do day in and day out so we can deliver the bestpossible products to our customers,” Drexler says in a statement.“TPG Capital, with whom we have a long working relationship, alongwith Leonard Green & Partners, are both well respected privateinvestment firms whose substantial resources and experience willenable us to invest in our future growth.”