In this articleMFollow your favorite stocksCREATE FREE ACCOUNTShopping bags in front of the Macy’s Inc. flagship store in the Herald Square area of New York, US, on Monday, Nov. 13, 2023. US holiday sales will grow at a slower pace this year amid economic headwinds such as higher interest rates, the National Retail Federation said. Bing Guan | Bloomberg | Getty ImagesTony Spring was already working against the clock to turn Macy’s around.Now, the CEO will have two fresh faces on the department store retailer’s board of directors as it weighs whether to bet on his vision or sell the nearly 166-year-old retailer to activist investors.The board appointments, announced this week that put an end to a proxy fight with activist Arkhouse Management, are the latest development in a broader, and so far, unsuccessful effort by Arkhouse and fellow bidder Brigade Capital Management to acquire the iconic but struggling American department store retailer.”It stops the pressures in the here and now,” said Neil Saunders, managing director of research firm GlobalData. “But in a way, you’re letting the wolf into the henhouse.”Arkhouse first made a bid in December to buy Macy’s and take the company private at $21 per share. Macy’s rejected the offer, Arkhouse raised its bid, and Macy’s rejected that offer, too. Arkhouse then launched its proxy fight and put forward nine nominees to Macy’s 15-person board.For Macy’s, this week’s settlement — an agreement to name two of Arkhouse’s nine candidates to its board — could pause the distraction and high costs of a prolonged campaign for shareholder support. For Arkhouse and Brigade, the move could help hand the keys to investors whose emphasis on real estate, not retail, has spurred fears that their acquisition could spell the end of Macy’s.Both Macy’s and Arkhouse struck a conciliatory tone in their statements this week. But one thing is clear: The battle at Macy’s is not over.Turning the tideOther department store chains have faced challenges from activists in recent years, and even when those efforts fall short, the pressure can bring about sweeping changes.With Kohl’s, for example, CEO Michelle Gass left the company to lead denim maker Levi Strauss after a lengthy battle with Kohl’s activists. At the time, her predecessor at Levi, Chip Bergh, said activist investors helped drive her out of Kohl’s doors.Even before Macy’s had activist investors breathing down its neck, Spring faced an uphill battle.The department store — with its flagship store in the heart of New York City’s Herald Square and its Macy’s Day parade that attracts the attention of millions of families on Thanksgiving morning — holds a storied place in American retail.But by nearly every metric, Macy’s has gotten smaller over the past decade. Its employee count, store count and stock price have fallen as the company has lost market share to competitors, including off-price chains like T.J. Maxx, big-box stores like Target, as well as online retailers and specialty stores.[embedded content]Macy’s shares, which hit a 10-year high of $72.80 in July 2015 and sank to a 10-year low of $4.81 in April 2020, closed at $19.30 on Friday, ending the week with a market value of $5.29 billion.Macy’s said in late February that it expects net sales for the full year to be down slightly from the prior year. It anticipates comparab …
Article Attribution | Read More at Article Source
[mwai_chat context=”Let’s have a discussion about this article:nnIn this articleMFollow your favorite stocksCREATE FREE ACCOUNTShopping bags in front of the Macy’s Inc. flagship store in the Herald Square area of New York, US, on Monday, Nov. 13, 2023. US holiday sales will grow at a slower pace this year amid economic headwinds such as higher interest rates, the National Retail Federation said. Bing Guan | Bloomberg | Getty ImagesTony Spring was already working against the clock to turn Macy’s around.Now, the CEO will have two fresh faces on the department store retailer’s board of directors as it weighs whether to bet on his vision or sell the nearly 166-year-old retailer to activist investors.The board appointments, announced this week that put an end to a proxy fight with activist Arkhouse Management, are the latest development in a broader, and so far, unsuccessful effort by Arkhouse and fellow bidder Brigade Capital Management to acquire the iconic but struggling American department store retailer.”It stops the pressures in the here and now,” said Neil Saunders, managing director of research firm GlobalData. “But in a way, you’re letting the wolf into the henhouse.”Arkhouse first made a bid in December to buy Macy’s and take the company private at $21 per share. Macy’s rejected the offer, Arkhouse raised its bid, and Macy’s rejected that offer, too. Arkhouse then launched its proxy fight and put forward nine nominees to Macy’s 15-person board.For Macy’s, this week’s settlement — an agreement to name two of Arkhouse’s nine candidates to its board — could pause the distraction and high costs of a prolonged campaign for shareholder support. For Arkhouse and Brigade, the move could help hand the keys to investors whose emphasis on real estate, not retail, has spurred fears that their acquisition could spell the end of Macy’s.Both Macy’s and Arkhouse struck a conciliatory tone in their statements this week. But one thing is clear: The battle at Macy’s is not over.Turning the tideOther department store chains have faced challenges from activists in recent years, and even when those efforts fall short, the pressure can bring about sweeping changes.With Kohl’s, for example, CEO Michelle Gass left the company to lead denim maker Levi Strauss after a lengthy battle with Kohl’s activists. At the time, her predecessor at Levi, Chip Bergh, said activist investors helped drive her out of Kohl’s doors.Even before Macy’s had activist investors breathing down its neck, Spring faced an uphill battle.The department store — with its flagship store in the heart of New York City’s Herald Square and its Macy’s Day parade that attracts the attention of millions of families on Thanksgiving morning — holds a storied place in American retail.But by nearly every metric, Macy’s has gotten smaller over the past decade. Its employee count, store count and stock price have fallen as the company has lost market share to competitors, including off-price chains like T.J. Maxx, big-box stores like Target, as well as online retailers and specialty stores.[embedded content]Macy’s shares, which hit a 10-year high of $72.80 in July 2015 and sank to a 10-year low of $4.81 in April 2020, closed at $19.30 on Friday, ending the week with a market value of $5.29 billion.Macy’s said in late February that it expects net sales for the full year to be down slightly from the prior year. It anticipates comparab …nnDiscussion:nn” ai_name=”RocketNews AI: ” start_sentence=”Can I tell you more about this article?” text_input_placeholder=”Type ‘Yes'”]
