Arkhouse and Brigade Increase Takeover Bid for Macy's to $6.9 Billion

Arkhouse Management Co. and Brigade Capital Management have increased their buyout offer for Macy's Inc. to about $6.9 billion, up from $24 a share, as reported by the Wall Street Journal. This move comes amidst Macy's ongoing turnaround efforts led by new CEO Tony Spring, who is focusing on improving underperforming stores, revamping successful ones, and expanding Bluemercury, a high-end cosmetics chain. The offer may prompt Macy's board to reconsider the benefits of going private.

The race for Macy's (M) takeover just got more intriguing as Arkhouse Management and Brigade Capital Management, two prominent investment firms, raised their buyout offer to about $6.6 billion [1]. This substantial increase from their previous proposal of $5.8 billion [1] comes as Macy's is undergoing a turnaround led by its new CEO, Tony Spring, who is focusing on enhancing underperforming stores, revamping successful ones, and expanding the high-end cosmetics chain, Bluemercury [2].

Macy's shares responded positively to the news, surging by 17% in pre-market trading Monday [1]. The retailer, which had recently announced the closure of 150 stores as part of its latest transformation plan [1], has been grappling with poor financial performance. In the fourth quarter of 2022, Macy's reported a net loss of $71 million, compared to a profit of $508 million the same period a year prior [1]. Quarterly net sales also declined to $8.1 billion from $8.3 billion [1].

Arkhouse and Brigade's latest offer may prompt Macy's board to reconsider the potential benefits of going private. However, the board has yet to make a decision, stating that it will review and evaluate the proposal [1]. The investment firms, backed by Fortress and OneIM, are reportedly open to increasing their offer further [1].

Macy's has a history of strategic restructurings and dividend hikes [1], making it an attractive target for potential buyers. The ongoing turnaround efforts, led by CEO Tony Spring, aim to strengthen the retailer's position in the competitive retail landscape.

For more information on this developing story, please visit [1] and [2].

References:
[1] Investopedia. (2023, February 20). Macy's Buyout Offer Jumps to $6.6 Billion as Arkhouse and Brigade Raise the Stakes. https://www.investopedia.com/macys-buyout-offer-jumps-to-6-6b-as-arkhouse-and-brigade-raise-their-bid-8603606
[2] AP News. (2023, February 19). Arkhouse, Brigade increase Macy's takeover offer to $6.6 billion. https://apnews.com/article/arkhouse-brigade-increases-macys-takeover-offer-3c8b396a1989f1016eca8f45057a7c68