People familiar with the situation told me on Sunday that Arkhouse Management and Brigade Capital Management have made an offer to buy Macy’s for $5.8 billion.
- IMPORTANT NOTES
- According to persons familiar with the situation, Arkhouse Management and Brigade Capital Management have made an offer to buy Macy’s Inc. for $5.8 billion.
- The offer values the retailer at $21 per share, up from the company’s most recent finish of just more than $17 a share.
- Macy’s sales have fallen in the last year as the heritage retailer tries to compete with online retailers.
The offer values the retailer at $21 per share, according to the sources. Macy’s closed at just over $17 a share on Friday, down roughly 17% since the start of the year. The company’s shares were up 19% in premarket trading on Monday.
Arkhouse, a firm that primarily targets real estate investment, and Brigade Capital, an asset management firm, would be willing to offer a higher bid based on due diligence, the sources said. The group would already be paying a premium for the department store, which has struggled to keep up with online competitors.
Macy’s has taken many initiatives to entice customers to return to its physical stores. It unveiled 30 new store locations in strip malls in October as it attempted to shift away from the typical shopping center. Despite the recovery attempts, Macy’s sales have dropped 7% year over year.
The retailer voiced confidence as its most recent quarter outperformed Wall Street estimates. By the numbers, that performance improvement was driven mostly by sales at brands that Macy’s owns, like Bloomingdale’s and Bluemercury, not the namesake Macy’s chain.
Macy’s has become an acquisition target as it struggles with sinking sales and competition from not only internet upstarts, but also brands that prefer to sell directly to customers rather than wholesale through a department store. In 2022, Kohl’s faced a similar takeover bid when it received various buyout bids that it claimed undervalued the company.
This year has been difficult for retailers across the board, as unpredictable interest rates and soaring inflation have put a strain on consumers’ budgets. Consumer spending, on the other hand, has been particularly resilient in the online shopping sector.
Consumer spending was strong online on Black Friday and Cyber Monday, but it’s uncertain how strong the holiday season will be after some retailers gave cautious fourth-quarter forecasts. Macy’s and Arkhouse declined to comment. The buyout offer was first published by the Wall Street Journal.
Click here, to check out the latest post on Instagram.
Also read: Weekly Market Wrap: D-Street In Supercruise Mode BJP Wins Critical Elections Despite Strong Macroeconomic Indicator, What’s Next?
image source: google
