Macy’s (NYSE: M) stock surged in pre-market trading Friday following news that Arkhouse and Brigade Capital raised their buyout offer to $6.9 billion.
The Wall Street Journal recently reported that an investor consortium, including Arkhouse Management and Brigade Capital Management, has increased its acquisition offer for Macy’s (NYSE: M). This marks the second increase in the offer as the consortium aims to take control of the struggling department store chain.
The latest proposal sees the investors upping their bid by approximately $300 million, raising the offer to $24.80 per share. This new offer values the remaining Macy’s stock not already owned by the consortium at around $6.9 billion.
Earlier this year, in March, the consortium had raised its bid to $24 per share, or about $6.6 billion, up from their initial $21-per-share proposal submitted on December 1. However, no transaction has yet materialized.
The current bid of $24.80 represents a nearly 43% premium to Macy’s closing price on December 8, the day deal talks initially surfaced.
In April, Macy’s appointed two new independent directors, Richard Clark, and Richard Markee, effectively ending a proxy battle with Arkhouse, which had sought to replace most of the 15-person board following the rejection of its takeover bid.
Macy’s disclosed in April that it was engaging with Arkhouse and Brigade on their buyout proposal, providing them with confidential information for due diligence purposes.
The board’s finance committee, which now includes Clark and Markee, will oversee the assessment of the proposal put forth by Arkhouse and Brigade.
In late May, Macy’s reported a year-over-year decline in first-quarter sales. However, the decrease was less severe than Wall Street had predicted. CEO Tony Spring, former head of Bloomingdale’s, subsequently upgraded the company’s outlook based on these results, suggesting a cautiously optimistic future despite ongoing challenges.
Macy’s (NYSE: M) Stock Reaction
As of 08:50 a.m. (Eastern Time) Thursday, Macy’s stock traded at $19.39, marking an 8.14% increase compared to the previous trading session.
