Macy’s Inc. (New York) said its board has terminated talks with Arkhouse Management Co. LP and Brigade Capital Management LP over the latter firms’ takeover offer. The board said those negotiations, which included a beefed-up offer last month that brought the total offer to about $6.9 billion, “have failed to lead to an actionable proposal with certainty of financing at a compelling value.”
As a result, the board said it wants the retailer’s management team to return its full focus to executing the department store retailer’s “A Bold New Chapter” strategy.
“While it remains early days, we are pleased that our initiatives have gained traction, reinforcing our belief that the company can return to sustainable, profitable growth, accelerate free cash flow generation and unlock shareholder value,” says Macy’s Chairman and CEO Tony Spring.
Macy’s said its “new chapter” strategy is gaining traction across all three of its strategic pillars – strengthening the Macy’s nameplate, accelerating luxury growth and simplifying and modernizing end-to-end operations. As part of that plan, the retailer is shuttering 150 underperforming traditional Macy’s stores, while expanding its Bloomingdale’s, Bluemercury and small-format Macy’s stores.
In its coverage of the Macy’s board’s action, CNBC noted that after Arkhouse’s initial overtures to Macy’s had been rebuffed, it said it intended to mount a proxy fight for control of Macy’s. The two sides reached a settlement in April, adding two independent directors to the Macy’s board.
As of this posting, neither Arkhouse nor Brigade had issued a statement about what their next steps – if any – might be.
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