May 10 (Reuters) - Sycamore Partners LP said on Friday struggling women's apparel retailer Chico's FAS Inc has declined to engage with the private equity firm on its cash offer to buy the company for $407.8 million.
In an SEC filing, Sycamore disclosed a 6.6% stake in the company, making it the fourth largest shareholder in Chico's. The private equity had offered about $3.50 per Chico's share, a discount of 5.4% to the company's Thursday close.
Chico's FAS, which is known for its Soma brand of women's intimate apparels, operates more than 1,000 stores in the United States and Canada and also sells its merchandise online.
The company did not immediately respond to a Reuters request for comment.
The 36-year-old retailer has been struggling with sales dropping for at least the last three years and is in the middle of a search for a new chief executive officer after Shelley Broader abruptly resigned in April.
"Given the rate and severity of the deterioration of the company's business, we believe that it is in the best interests of all stockholders for the board to create those options," Sycamore said in a letter to Chico's board, which was part of the filing.
Shares of the company, which have fallen nearly 62% in the last one year, were up 2% in early morning trade.
Reporting by Soundarya J in Bengaluru; Editing by Arun Koyyur