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A private equity group has made a $5.8B offer to take Macy’s private.
The offer from Arkhouse Management and Brigade Capital Management values the long-time department store chain at $21 per share, The Wall Street Journal reported. The two firms already own some Macy’s (NYSE:M) stock.
Given Macy’s (M) closing price of $17.39 on Friday, the offer is a ~21% premium to that close.
The newspaper said that the offer was made on Dec. 1 and the company’s board has met to discuss it, though there is no word on how the board is leaning.
Arkhouse and Brigade Capital believe Macy’s (M) is undervalued and are prepared to raise their offer subject to due diligence. They also have the support of an investment bank who has provided a letter on their ability to raise capital to complete the deal.
Year to date, Macy’s (M) shares are down ~14%.
In its Q3 financial results released in November, the company beat on the top and bottom lines, and also boosted its sales and EPS guidance for fiscal 2023. Even though it was a beat, revenue declined about 7% compared to the prior-year period.
