Macy's receives $5.8 billion buyout offer, sources say

Macy's receives .8 billion buyout offer, sources say


People wait in line outside Macy’s before opening on “Black Friday” in New York City on November 24, 2023. The retail sector’s efforts to entice holiday gift purchases builds to a crescendo this weekend with the annual “Black Friday” shopping day followed by the newer “Cyber Monday.” (Photo by Yuki IWAMURA / AFP) (Photo by YUKI IWAMURA/AFP via Getty Images)

Yuki Iwamura | Afp | Getty Images

Arkhouse Management and Brigade Capital Management have offered to buy Macy’s for $5.8 billion, people familiar with the matter told CNBC on Sunday.

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 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 made several efforts to draw customers back to its brick-and-mortar chains. In October, it announced 30 new store locations at strip malls as it tried to pivot away from the traditional shopping mall.

Despite the turnaround efforts, Macy’s sales have slumped, declining 7% year over year.

The retailer expressed optimism after its most recent quarter beat Wall Street’s expectations. 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 grapples with sagging sales and competition not just from online upstarts, but also from brands that would rather sell their products directly to consumers than wholesale through a department store. Kohl’s faced a similar takeover bid in 2022 when it received multiple acquisition offers that it said undervalued its business.

Retailers across the board have faced headwinds this year as volatile interest rates and high inflation weigh on consumers’ wallets. However, consumer spending has proven particularly resilient in the online shopping sector.

Consumer spending was robust online during Black Friday and Cyber Monday but it’s still unclear how strong the holiday season will be after numerous retailers issued cautious fourth-quarter outlooks.

Arkhouse and Macy’s declined to comment. Brigade did not immediately respond to CNBC’s request for comment.

The Wall Street Journal first reported the buyout offer.



Source

Why airlines are raising baggage fees — and charging you more at the airport
Business

Why airlines are raising baggage fees — and charging you more at the airport

Travelers arrive for flights at O’Hare International Airport in Chicago on March 16, 2021. Scott Olson | Getty Images News | Getty Images Airlines are raising their prices to check a bag — again. Just how much you it will cost you, however, depends on when you pay for the service. United Airlines, American Airlines […]

Read More
Carvana stock surges on first annual profit, pair of analyst upgrades
Business

Carvana stock surges on first annual profit, pair of analyst upgrades

Vehicles are seen on a display at a Carvana dealership on February 20, 2023 in Austin, Texas. Brandon Bell | Getty Images Carvana shares surged 30% Friday morning after posting its first-ever annual profit and receiving a pair of upgrades by Wall Street analysts. The used-car retailer has been trimming inventory and expenses as it […]

Read More
New sickle cell gene therapies are a breakthrough, but solving how to pay their high prices is a struggle
Business

New sickle cell gene therapies are a breakthrough, but solving how to pay their high prices is a struggle

Blood sample of patient positive tested for sickle cell. Kitsawet Saethao | Istock | Getty Images The approval of two gene therapies to treat sickle cell disease has given hope to patients who suffer from the debilitating disease, which overwhelmingly affects Black people and people of color. Health officials now face a challenge in finding […]

Read More