(Reuters) -Macy’s has terminated Macy’s take-private discussions with Arkhouse Management and Brigade Capital. The decision came after their raised offer lacked financing certainty and failed to offer compelling value, causing a 15% drop in early trading.
On Monday, Macy’s disclosed that the investor group revised its offer on June 26. The new offer increased to $24.80 per share, up from $24 offered in March.
The new offer price valued the company at $6.86 billion and was at a nearly 43% premium to the stock’s close on Dec. 8, when the news of the offer first emerged. #MacysTakePrivateDiscussions
Arkhouse, which has a 4.4% stake in Macy’s, and Brigade Capital Management did not immediately respond to a Reuters request for comment.
In April, Macy’s announced that two of Arkhouse’s nominees would join its board’s finance committee. Their role included overseeing the evaluation of the investor group’s proposal.
The deal talks occurred during a pivotal period for Macy’s, which under CEO Tony Spring’s leadership, initiated a turnaround plan. This plan emphasized job cuts and the closure of 150 stores by 2026.
On Monday, Macy’s announced that its board intends for the management team to refocus on enhancing shareholder value. This shift includes executing the turnaround plan without distraction.
The company had raised its annual profit forecast in May on the back of Spring’s strategy that aims to save $100 million in costs this year, though sales remained under pressure due to sluggish demand.
Macy’s decision to terminate take-private discussions with Arkhouse and Brigade marks a significant shift in their strategic direction. #MacysTakePrivateDiscussions
