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Key Takeaways
- Macy’s on Monday said it had ended negotiations with activist investor Arkhouse Management and Brigade Capital Management after finding their latest buyout offer “not compelling.”
- The latest offer of $24.80 per share followed bids of $21 per share in December and $24 per share in March.
- Shares of Macy’s swooned in intraday trading Monday.
After months of negotiation, Macy’s ( M ) on Monday said it had ended talks with would-be buyers Arkhouse Management and Brigade Capital Management.
The announcement comes after the activist investors recently upped their offer by about $300 million to $6.9 billion.
The two companies initially presented Macy’s with a $21-per-share deal to take the retailer private in December, which the board rejected. That led Arkhouse and Brigade to launch a proxy fight that ended when Macy’s approved two board members backed by the investors, after Arkhouse and Brigade came back in March with a $24-per-share bid.
Macy’s Deems Latest Offer ‘Not Compelling’
Arkhouse’s latest offer went as high as $24.80, a 38.3% premium over Macy’s closing price at the time, but the biggest U.S. department store chain dismissed it as “not compelling.”
“Rather than delivering a definitive, fully financed and actionable proposal, Arkhouse and Brigade submitted a response they characterized as a ‘check in’ letter expressing an interest in acquiring all of the outstanding shares of the company for $24.80 per share in cash, which is within a range the board had previously communicated to Arkhouse and Brigade was not compelling,” Macy’s said.
Shares of Macy’s plunged more than 13% to $16.55 as of 11:15 a.m. ET Monday.