Could a buyout be Macy’s “white knight”?

David Einhorn's investment has fueled talks of a takeover

New York /
Jan.January 21, 2016 10:35 AM

The future of Macy’s hangs in the balance, and the possibility of a buyout has some investors excited.

David Einhorn of Greenlight Capital invested in the department store this week, a development that further fueled talks of a possible buyout. For now the prospect is primarily an investor fantasy: It’s unclear who would step in to takeover the struggling retailer but it would require someone who is willing to take on a significant amount of debt.

For months, hedge fund Starboard Value pushed the department store to spin off its real estate assets as a real estate investment trust. After Macy’s rejected this plan, Starboard suggested that the store separate its big-city flagship stores from its mall properties, creating joint venture entities for each. Einhorn also suggested that a private equity firm should team up with a REIT to “unlock value,” Bloomberg reported.

Lawrence Haverty, a fund manager at Gamco Inc., which owns shares of Macy’s, has said that he would support a buyout that would work out to $60 a share in cash, but such a deal isn’t likely. Laurent Vasilescu, an analyst at Macquarie Capital USA, told Bloomberg that Macy’s — instead of a buyout — will likely strike a balance by closing down more of its failing stores and investing in the stores that have the most value. [Bloomberg]Kathryn Brenzel


Related Articles

arrow_forward_ios
Triangle Junction at 2201 Nostrand Ave (Google Maps, Getty)
Aldi signs lease for 20K-sf store in Flatbush
Aldi signs lease for 20K-sf store in Flatbush
Clockwise from left: Flushing’s Main Street, City Point in Brooklyn and Bronx’s Fordham Road (Getty)
Manhattan’s retail loss is outer boroughs’ gain
Manhattan’s retail loss is outer boroughs’ gain
2 Bank Street (Google Maps, iStock)
Pizzeria featured in “Eat Pray Love” signs lease in Greenwich Village
Pizzeria featured in “Eat Pray Love” signs lease in Greenwich Village
Dollar General CEO Todd Vasos (Retail Industry Leaders Association, iStock)
Dollar General thrives amid retail apocalypse
Dollar General thrives amid retail apocalypse
(Getty)
Manhattan retail market awaits recovery as vacancies rise in Q1
Manhattan retail market awaits recovery as vacancies rise in Q1
(Getty, iStock)
McDonald’s to shutter hundreds of Walmart outposts
McDonald’s to shutter hundreds of Walmart outposts
The vacancy rate for regional and superregional malls is at an all-time high.  (Getty)
Mall vacancy rate hits all-time high
Mall vacancy rate hits all-time high
38 Warren Street and CVS CEO Karen S. Lynch (Google Maps, CVS)
CVS signs lease in Tribeca’s Keystone Building
CVS signs lease in Tribeca’s Keystone Building
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...