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They raised the offer price to $24 per share for the remaining
stake that they do not own from $21 per share. The retailer's
shares, which had lost 10% last year, rose to $21 following the
latest bid.
"We remain open to increasing the purchase price further subject
to the customary due diligence," Arkhouse had said on Sunday.
Macy's is yet to open its books to the bidders as it was
reviewing the new offer after rejecting in January a prior bid
from Arkhouse on concerns around deal financing and valuation.
The real estate-focused investing firm has now said it has
identified global lenders who will commit to financing the deal
if due diligence was granted.
"Macy's should cooperate with the investment group and pursue a
possible sale. If it refuses to do so, it runs the risk of a
hostile takeover," said David Swartz, an analyst with
Morningstar Research.
The company has struggled to maintain its sales growth and
profitability amid competition from cheaper physical and
ecommerce offerings and a value-based shopping pattern due to
elevated inflation and higher borrowing costs.
It last week unveiled a turnaround plan that included cutting
store counts and job roles, while aiming to revive sales at its
luxury labels Bloomingdale's and Bluemercury by improving
merchandise and adding more staff.
Arkhouse, which has an economic exposure of 4.4% to Macy's along
with its affiliates, has piled pressure by nominating nine
director candidates with retail, real estate and capital markets
experience to the company's 14-member board.
Macy's forward price-to-earnings multiple, a common measure for
valuing stocks, is 6.73, lower than industry peers, including
Kohl's and Nordstrom that have a P/E ratio of 10.36 and 10.28,
respectively.
(Reporting by Savyata Mishra in Bengaluru; Editing by Arun
Koyyur)
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