iParty Corp., a Dedham-based party goods retail chain of 54 stores, said Friday that it has agreed to be acquired Party City Holdings Inc., a large party supply retailer headquartered in New Jersey, in a deal valued at nearly $11 million for shareholders of its common stock.
iParty said the proposed transaction has an enterprise value of $38 million.
Thomas H. Lee Partners, the Boston investment management firm, acquired a majority stake in Party City last June. For Party City, the proposed purchase will give it a potential foothold in the New England, where it currently does not have a presence, Party City chief executive Gerald C. Rittenberg, said in a statement. Party City currently has 750 company-owned and franchise locations throughout North America.
One of iParty’s most important seasons is Halloween, and the company said its business was hurt by storms two years running, most recently by Hurricane Sandy. In November, iParty announced that it had hired the investment bank Raymond James & Associates to help the company in “exploring a broad range of financial and strategic alternatives.”
Under the sales agreement, iParty said in a press release that Party City will acquire iParty for $0.45 per share; that price represents a 200 percent premium over the closing price of iParty common stock as of Feb. 28.
The transaction is expected to close during the second quarter, iParty said.
Sal Perisano, iParty’s chairman and chief executive, said in a statement that the Party City network “will benefit our stores and products by significantly increasing our scale and broadening our geographic presence. We look forward to working with Party City and its management team as we integrate our companies.”