Shares in women's apparel group Ann Inc rose in early trading as the company revealed it has entered into a confidentiality agreement with private equity firm Golden Gate Capital.

The agreement covers discussions between Ann Inc and a unit of Golden Gate Capital Corp regarding the company's ongoing review of options to boost shareholder value, and comes just a month after the company was urged by some hedge funds to sell itself.

In a filing, the company said it has been engaged in "a collaborative, constructive dialogue" with Golden Gate.

"The company and Golden Gate believe that, given Golden Gate's expertise in speciality retail and the positive interactions between the companies to date, it would be beneficial to continue discussions on a more detailed basis."

In March, Golden Gate revealed it holds a 9.5% shareholding in Ann Inc and said it believed the stock was "undervalued".

In August, the apparel firm booked a drop in third-quarter earnings as a result of softer traffic levels and a highly promotional retail environment.