The board of Children's Place Retail Stores Inc. said Friday it has approved a request from its former chief executive Ezra Dabah to work on a proposal to acquire the company with a private equity firm.

Dabah had asked the board's permission to bypass shareholder acquisition laws that could otherwise preclude Golden Gate Private Equity Inc.'s participation in an offer.

Dabah said in February he wanted to buy the children's clothing retailer for about $578 million. According to a filing with the Securities and Exchange Commission, Dabah sent a letter revealing his intentions to offer, along with the equity firm, $24 per share in cash.

The stock closed Friday up 66 cents, or 2 percent, to $29.40.

Children's Place said in a statement Friday it granted the request so it could evaluate all its strategic options.

"There is no assurance that any such proposal will be made or, if made, would lead to an agreement with the company providing for a sale of the company," it said in the statement.

Dabah was forced out in September after a company probe found he had violated internal policies for securities trades.

Golden Gate Private Equity declined to comment late Friday.