An investor group is offering to buy Macy’s for $5.8 billion and take the publicly held department store chain private, according to reports by CNBC, The New York Times, and other media.
The bid, from Arkhouse Management and Brigade Capital Management, is to purchase Macy’s for $21 a share, which would value the company at $5.8 billion, more than $1 billion above its current market capitalization. Macy’s stock closed Friday at $17.30 a share.
At press time, Macy’s had not responded to the reported buyout offer.
Arkhouse is a New York City–based investment firm specializing in “opportunistic real estate.” Brigade Capital Management was one of three funds that owned the Ekati diamond mine following its bankruptcy.
“Department stores have been a frequent target of takeover attempts over the past several years by investors looking to take advantage of prime real estate,” according to The New York Times.
In Forbes, Richard Kestenbaum, cofounder of Triangle Capital, wrote that “the current bid is probably not the last word. The premium being offered is not huge by takeover standards, and there’s a good chance the investors will raise their offer if they have the opportunity.”
If Macy’s is sold, Kestenbaum predicted the retailer would “probably undergo significant change in one form or another so the investors can increase profitability and make back their money.”
(Photo courtesy of Macy’s)
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