Department store chain Macy’s won’t sell itself to activist investors Arkhouse and Brigade Capital after all. The company announced this week that the buyout talks with the two investment firms have been terminated.
Arkhouse and Brigade have been engaged in acquisition talks with Macy’s for the past seven months. After seeing their initial bid rebuffed, they presented an improved offer earlier this month that valued the retailer at $6.9 billion, a significant premium compared to Macy’s market cap of $4.53 billion.
However, according to Macy’s press release, Arkhouse and Brigade’s offer “lacks certainty of financing and does not deliver compelling value.”
“Arkhouse and Brigade submitted highly conditional and unsigned drafts of financing commitment letters, subject to numerous conditions, including, in certain cases, diligence on Arkhouse and Brigade themselves,” Macy’s shared in the press release.
The top executives of Macy’s say they remain committed to creating value for their shareholders and are focused on executing “A Bold New Chapter” strategy. This strategy includes “strengthening the Macy’s nameplate, accelerating luxury growth, and simplifying and modernizing end-to-end operations.”
Macy’s stock has tumbled 12% after the termination of buyout talks was made public. Its latest close price of $16.81 per share makes the stock 14.93% down year-to-date.