Kohl’s Corp. [s: kss] released a statement Friday stating that it is rejecting the buyout offers it received.
The news sent shares down 3.3% in premarket trading. Word that Kohl’s was considering a buyout sent its own shares higher last month, as well as those of other department stores including Macy’s Inc. M, -0.87% and Nordstrom Inc. JWN, -2.67%
“The Kohl’s Board of Directors (the Board) has determined, following a review with its independent financial advisors and upon the recommendation of its Finance Committee, that the valuations indicated in the current expressions of interest which it has received do not adequately reflect the Company’s value in light of its future growth and cash flow generation,” the statement said.
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Kohl’s KSS, +1.03% confirmed last week that it had received an offer from Acacia Research Corp, which is controlled by activist hedge fund Starboard Value LP. Later Acacia said its offer was for $64 per share in cash.
Sycamore Partners said it could pay $65 per share, but did not submit a formal offer, according to The Wall Street Journal.
Kohl’s has been executing a turnaround that includes a focus on athleisure merchandise, a partnership with beauty retailer Sephora, and other measures.
“We have a high degree of confidence in Kohl’s transformational strategy, and we expect that its continued execution will result in significant value creation,” said Kohl’s Chairman Frank Sica in a statement.
Kohl’s stock has rallied 18.8% over the past year, outpacing the benchmark S&P 500 index SPX, -2.44%, which is up 15.6% for the period. The ProShares Decline of the Retail Store ETF EMTY, +1.34% has tumbled 19% for the period.
Kohl’s also announced Friday a limited-duration shareholder rights plan, effective immediately through Feb. 2, 2023. The plan will become exercisable if any stockholder acquires 10% beneficial ownership, or 20% in the case of passive institutional investors.
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Kohl’s says the “poison pill” will allow the company to entertain offers with an “orderly review.”
