Private equity giant Sycamore Partners is exploring the possibility of acquiring Macy's, even though the iconic retail chain rejected an unsolicited offer from another bidding group this week. The Post reported.
Sycamore, a prolific acquisition company with retail properties such as Ann Taylor, Talbots and regional department store chain Belk, has reportedly been in secret negotiations with Macy's, which owns Bloomingdale's, since at least late December. told the Post.
America's largest department store became a takeover target as sales and foot traffic at its 722 stores across the country slumped.
Last week, Macy's announced 2,300 job cuts, most of them in corporate roles.
The talks follow a $5.8 billion takeover offer from investment firms Arkhouse Management and Brigade Capital last month.
Macy's rejected that bid earlier this week, but in recent years activist investors Starboard Value and Jana Partners, as well as Saks Fifth Avenue owner and Canadian-based peer Hudson's Bay Company has attracted acquisition attempts from
While Sycamore is not as good as Macy's as Ark House and Brigade, some retail industry insiders say the New York-based company, led by media-shy dealmaker Stefan Kaluzny, has the acumen to make deals work. I believe there is financial support.
A Sycamore spokesperson declined to comment.
“Sycamore owns Velux and other apparel brands, so it makes a lot of sense,” said a top retail executive.
“The genius of Mr. Stephens is that from day one he acquired procurement companies that were the backbone of every investment,” another retail executive told the Post. “Having the ability to reduce costs and add returns to investments is part of his overall recipe.”
Its manufacturing and sourcing company is MGF Sourcing, formerly owned by The Limited. Sycamore acquired control of MGF in 2011.
Elsewhere, Sycamore has focused on struggling retailers, picking up brands such as Anne Klein, Nine West, Lane Bryant, Torrid and Staples.
The company acquired Jones Group in 2014 and sold its brands Jones New York, Stuart Weitzman, Kurt Geiger and Easy Spirit, according to the Wall Street Journal. report.
At the beginning of the pandemic, Sycamore Partners nearly bought Victoria's Secret but backed out of the deal.
This week, Macy's board of directors rejected proposals from Arkhouse and Brigade, citing concerns about investors' ability to raise capital.
In response, Arkhouse and Brigade are considering the possibility of making a direct hostile bid to Macy's shareholders, the companies said in a statement.
Ark House Managing Partner Gabriel Kahane told Bloomberg on Monday that the non-disclosure agreement needed to begin due diligence on a potential Macy's acquisition was “unlikely for them to send us an NDA.” I sincerely hope so.”
Macy's declined to comment on the Sycamore negotiations, and the Post pointed to the Jan. 21 negotiations. statement Rejects the Brigade and Ark House's offers.
“Macy's isn't really interested in deals,” said one retail executive familiar with the company. “They will repel everything.”
Outgoing Macy's CEO Jeff Gennette said in a letter to Arkhouse and Brigade that their proposal “continues to drive shareholder value through the execution of our business strategy and value creation measures.” “It would be an unnecessary distraction from our management team.”
