Arkhouse and Brigade have been trying to buy the well-known retailer for months, and earlier this month the bidders raised their offer price to $24.80 per share, the latest in a series of price hikes since they began their acquisition campaign last year.
Macy’s said that during the due diligence period, it provided the bidders with store-by-store profit and loss information and leases for each store “far beyond what would normally be required.” It also noted that Arkhouse and Brigade were permitted to share that confidential information with more than a dozen “trusted financial sources.”
Arkhouse announced its intention to launch a proxy fight for control of Macy’s earlier this year after its initial attempt was rejected. The two sides reached a settlement in April that added two independent directors to Macy’s board of directors.
Arkhouse did not immediately respond to a request for comment.Macy’s shares fell about 15% in premarket trading Monday.
Macy’s is in the midst of a turnaround led by CEO Tony Spring. Appointed as CEO in FebruaryThe department store operator said earlier this year, Approximately 150 stores of the same name will close The company will open new stores for two of its best-performing brands, Bloomingdale’s and Bluemercury. Macy’s opens small stores In a busy shopping mall on the outskirts of the city.
But the veteran department store’s efforts to boost sales have been hampered by high inflation as consumers become more cautious about spending on discretionary goods. Fighting to stay relevantYounger shoppers are increasingly turning to online players like Shein and the goal Off-price chains, etc. TJ Maxx Instead of department stores.
Macy’s expects net sales to be in the range of $22.3 billion to $22.9 billion for the current fiscal year, down from $23.09 billion in 2023. The company now expects same-store sales, which exclude the impact of store openings and closures, to range from a decline of approximately 1% to an increase of 1.5% on a combined company-owned and licensed sales basis, including third-party marketplace sales.
On an earnings call in late May, Spring said Macy’s was in the “early stages” of revitalizing its namesake stores. Pointed out better sales results The first 50 stores saw Macy’s invest in additional staffing, enhanced merchandise displays and special events.
Arkhouse is a well-known real estate investment firm led by Gabriel Kahane and Jonathan Blackwell. It’s not a traditional activist firm, but it has made several unsolicited bids for REITs in recent years. Brigade Capital Management specializes in retail companies and has previously invested in companies like Sears and Neiman Marcus.
The bidders worked together to unlock value believed to be trapped in Macy’s real estate holdings while simultaneously reforming the company’s operations. Other department store names have recently been targets of activists for similar reasons. Activist Fund Macellum Urged Coles To sell themselves.
