Macy’s and Arkhouse continue fight after proxy settlement in take-private bid

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Shopping 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.

Exciting Developments at Macy’s Inc.

Tony Spring, the CEO of Macy’s, is facing significant challenges as he works to turn the 166-year-old retailer around. The recent board appointments at Macy’s mark the end of a proxy fight with activist Arkhouse Management and signify a critical juncture for the company. The board is currently weighing the options of pursuing Spring’s vision or selling the struggling department store to activist investors.

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Arkhouse made a bid to acquire Macy’s in December, followed by a proxy fight and an increased offer to buy the company. The settlement to appoint two independent directors from Arkhouse to the Macy’s board aims to alleviate shareholder pressures and costs while keeping the potential acquisition by activists in the mix.

Turning the Tide for Department Store Chains

Department store chains, like Macy’s, have faced challenges from activists in recent years, leading to significant transformations within the industry. With Kohl’s experiencing its own battles with activists, the pressure for change continues to mount.

Despite Macy’s iconic status in American retail, the company has faced a decline in various metrics over the past decade. From employee count to stock price, Macy’s has seen a decrease as competitors capture more market share in the retail landscape.

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Future Strategies and Potential Buyout

Spring’s vision for Macy’s involves a restructuring plan that includes closing underperforming stores and focusing on locations with higher sales volume. The strategy also involves investing in Macy’s successful chains, Bloomingdale’s and Bluemercury.

Meanwhile, the potential buyout by Arkhouse and Brigade poses a significant shift in Macy’s trajectory. The activist investors are conducting due diligence to understand the company’s financials better, with plans to keep Macy’s stores operational while leveraging the value of its real estate.

Meet the New Directors

The addition of two new directors, Richard Clark and Richard Markee, with extensive backgrounds in retail and real estate, brings unique perspectives to the Macy’s board. These independent directors will play a crucial role in evaluating the acquisition bid and shaping the company’s future direction.

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