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04/22/2022

Simon Property, Brookfield reportedly interested in bidding for Kohl’s

Marianne Wilson
Editor-in-Chief
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Kohl’s is under pressure from an activist investor to sell itself.

Add two high-profile players to the lineup of parties reportedly interested in Kohl’s Co.

Simon Property and Brookfield are said to have expressed in putting together a potential bid for the department store chain, according to CNBC’s David Faber (as reported by Seeking Alpha). (The two mall owners teamed up to buy the retail and operating assets of J.C. Penney in late 2020.) The list of companies reportedly bidding for Kohl’s also includes Hudson’s Bay, Sycamore Partners, Acacia Research, Starboard Value and Franchise Group.

On Thursday, Kohl’s revealed in an investor presentation that Goldman Sachs, which it has hired to explore strategic alternatives, has engaged with more than 25 parties and that “select bidders have been invited to a data room containing over 550,000 pages across over 55,000 documents, as well as meetings with management.”

“While preliminary, non-binding proposals have been received, further diligence is ongoing with requests for proposals including committed financing and binding documentation,” Kohl’s stated.

Meanwhile, Kohl’s received a vote of confidence from T. Rowe Price Associates, one of its biggest investors. The company said it plans to back all of the department store's directors, dealing a setback to activist investor Macellum Advisors, which is running its own slate of nominees as it tries to take control of the board.

We intend to vote FOR the 13 nominees presented by the Kohl’s board. We do not intend to vote on the Macellum card, and we will not support any of its 10 nominees," T. Rowe Price said in a case study about how it intends to vote.

Kohl’s and Macellum have been engaged in a war of words for months now, trading barbs back and forth. Early this month, Macellum, which holds nearly a 5% stake in the chain, issued an open letter to the Kohl’s board in which, among other things, it alleged that it is being kept “in the dark” regarding bids for Kohl’s.

Kohl’s has repeatedly gone on the offense in criticizing Macellum’s board slate, calling the candidates unqualified and inexperienced.

[Read More: Kohl’s urges shareholders to reject activist’s board ‘unqualified’ board slate]