Macy’s accepts two directors from investor group seeking acquisition
Macy's has avoided a proxy fight with activest investor Arkhouse by appointing two of the firm’s nominees to its 15-person board board of directors.
The depaartment store giant has appointed two new independent directors, Richard (Ric) Clark and Richard (Rick) L. Markee, to its board, 10, 2024. The appointments of Clark and Markee follow the board’s engagement with Arkhouse, which made an initial bid to purchase the company Dec. 1, 2023, in the withdrawal of its director nominations.
"We are pleased to welcome Ric and Rick to the Board as we advance our efforts to deliver value for shareholders," said Tony Spring, chairman and CEO of Macy’s Inc. "Ric and Rick bring leadership experience as well as valuable real estate and retail industry expertise, respectively, that is complementary to that of our other board members. We are confident the company will benefit from their additional perspectives."
Meanwhile, two managing partners of Arkhouse issued a statement saying these board appointments will aid the company’s continuing efforts to purchase Macy’s.
"Ric Clark and Rick Markee bring tremendous dealmaking experience to Macy’s board and will be instrumental in maximizing value for shareholders," said Gavriel Kahane and Jonathon Blackwell, Arkhouse managing partners. “As a result of our efforts, our buyer group has begun receiving due diligence to progress discussions toward a potential transaction to acquire the company. The appointment of Clark and Markee to the board and the finance committee, which is tasked with reviewing our proposal and any alternative transactions, will ensure that our discussions continue to be constructive and that our proposal is treated seriously and expeditiously. We appreciate the board’s engagement and look forward to working with them to unlock shareholder value."
Arkhouse ups buyout bid for Macy’s by nearly $1 billion
In March 2024, an investor group consisting of Arkhouse Management Co. and Brigade Capital Management said it was increasing its all-cash proposal to acquire Macy’s to $24 a share, or about $6.6 billion, up from its initial bid in December of $21 a share, or about $5.8 billion. The Macy’s board rejected the offer in January, citing “lack of compelling value” in the proposal.
Arkhouse and Brigade said their new offer represents a 51.3% premium to Macy’s share price as of Nov. 30, 2023, the day before they submitted their original proposal. It also represents a 33% premium to Macy’s stock price as of Friday, when it closed at $18.01 a share.
Arkhouse and Brigade also disclosed additional information about their financing, including identifying Fortress Investment Group LLC and One Investment Management US as equity capital partners for the proposed transaction. In rejecting the bid in January, Macy’s had raised questions over its financing.
Macy’s enacts board changes
Macy’s is also implementing previously announced changes to its board, effective April 10. Tony Spring, CEO and chairman-elect of Macy’s Inc., has assumed the chairman role. In addition, Douglas (Doug) W. Sesler, has been appointed as an independent director. These changes follow the planned retirements of Jeff Gennette and Frank Blake from the Macy’s board.