Kohl’s Sees $9B Bid for Sale

There’s been a bid to buy Kohl’s for $9 billion from a group backed by Starboard Value LP, The Wall Street Journal (WSJ) reported Friday (Jan. 21).

The group is led by Acacia Research, which is controlled by Starboard. Per the WSJ, the group offered to buy the department store chain for $64 a share, according to sources familiar with the matter.

The group told Kohl’s that it had gotten assurances from bankers that it would be able to get financing for the bid. However, the WSJ report noted that there’s no guarantee the group will line up the funding needed to make a firm offer — or that Kohl’s will go for the deal in the end.

Acacia is not very well known and has a market value of $215 million. The consortium told Kohl’s that it received a “highly confident” letter from a bank, saying it will be able to get a debt financing package for some of the bid.

Per the report, the group may end up selling the company’s real estate to another party, which could make it easier to finish the transaction. Activists have said that Kohl’s could do sale-leasebacks of its real estate, which could come out to $7 billion or more.

Kohl’s has faced pressure in recent weeks to sell, with activist shareholders positing that it ought to at least split off part of the company to increase profits.

PYMNTS reported in December that Kohl’s was being asked to sell itself outright or spin off its eCommerce business to help boost the stock price.

See also: Kohl’s Urged to Sell Company or Spin off eCommerce Business

Hedge fund Engine Capital, one of the company’s stockholders, backed that request by citing that Kohl’s stock prices had fallen 25% in the seven months leading up to December. Engine owns around 1% of the $7.3 billion Kohl’s.

Earlier this week, Kohl’s said it has been seeing results and had regularly been working with “specialized advisors” to help achieve more results and long-term value. The company added that a strategy will be unveiled at its investors day in March.

Read more: Kohl’s Attacked by 2nd Activist Investor, Dept Store Blasted for Lack of Urgency, Wasted Year