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The board of the department store Macy's unanimously decided Monday (July 15) that it would terminate its negotiations with both Arkhouse Management and Brigade Capital pertaining to the groups' proposal to acquire the retailer.

In a press release, Macy's lead independent director Paul Varga said that the firms' proposal regarding the financing of the $6.9 billion buyout deal "lacks certainty."

Attempts to Make Macy's Private

CNBC reported that Arkhouse and Brigade have been negotiating to buy Macy's out for months, with bidders increasing their offer to $24.80 per share.

In its statement, Macy's said that it had gone "well beyond" the customary due diligence requirement, and that it did its utmost to inform the bidder groups and allowed the companies to share the confidential information to several "credible financing sources."

After an initial setback, Arkhouse said earlier this year that it intended to wage a proxy war for the control of Macy's, which was settled by allowing two independent directors into the company.

Both independent directors have since voted alongside the rest of the board to end negotiations.

Macy's Looking to Turn Fortunes Around

Macy's shares fell by around 14% in early trading Monday after the announcement of the end of talks between it, Arkhouse, and Brigade.

VCPost previously reported that Macy's is currently in a turnaround effort led by CEO Tony Spring despite high inflation and the struggle to stay relevant slowing the company down.

The company also expected its net sales to range between $22.3 billion and $22.9 billion, a drop from $23.09 billion in 2023

Earlier this year, the retailer announced that it was closing about 150 of its stores and opening new locations of Bloomingdale's and Bluemercury, which have performed stronger than the mother brand. There are also plans for opening smaller Macy's locations in strip malls in the suburbs.

Tags

Mergers, Acquisitions, Mergers and acquisitions, M&A