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Macy’s (NYSE:M) has spurned a $21 a share takeover offer from Arkhouse Management and Brigade Capital Management, setting the stage for a potential showdown as the private equity firms threaten to bypass the company and appeal directly to shareholders.
Before Macy’s official rejection, the investment groups issued a veiled ultimatum, expressing readiness to engage stockholders to secure their $5.8 billion bid for the department store chain.
“We are highly motivated to consummate an acquisition of Macy’s and are prepared to pursue all necessary steps, including direct engagement with stockholders, to achieve this goal,” affirmed Arkhouse Managing Partners Gavriel Kahane and Jonathon Blackwell in a statement.
Their plea, however, fell on deaf ears as Macy’s snubbed the offer, stating that the non-binding proposal did not warrant divulging any due diligence information to the bidders.
In a letter to Arkhouse and Brigade, Macy’s board underlined “serious reservations” about the investment firms’ financial capacity to fulfill their non-binding bid.
The retaliatory move from Arkhouse, as reported by the WSJ, compounds Macy’s existing woes, following news that the retailer plans to shed approximately 13% of its corporate workforce and shut down five stores.
Meanwhile, Terraform Labs, the company behind the failed cryptocurrencies TerraUSD (UST-USD) and Luna (LUNA-USD), has filed for Chapter 11 bankruptcy protection in the wake of a colossal crash that wiped out around $40 billion.
As Terraform grapples with legal action from both the SEC and irate investors, it joins a growing list of casualties in the crypto arena. The company is seeking refuge within bankruptcy laws to navigate the legal imbroglio while vowing to honor its financial commitments amid the proceedings.
In a slightly different sector, SolarEdge Technologies (NASDAQ:SEDG) is bracing for a significant workforce reduction, announcing plans to trim 16% of its employees as business headwinds prompt a 55% revenue slump in Q4 2023.
The company, whose market valuation has plummeted by a staggering 80% over the past 12 months, faces a daunting road to recuperation, with Barclays recently downgrading its stock and casting doubt on its revival prospects.
Turning to market events, the blackout period commences for Federal Reserve members ahead of the January 30-31 meeting, BJ’s Restaurants (BJRI), Xponential Fitness (XPOF), and First Watch Restaurant Group (FWRG) are slated to participate in the Jefferies Consumer Summit, and WTI crude February futures are set to expire amid heightened volatility in the oil market.
On the earnings front, United Airlines Holdings (UAL) is due to unveil its Q4 results after the market closes, with analysts projecting a 30.5% year-on-year slump in EPS, accompanied by a 9.3% revenue uptick.
Meanwhile, global stock markets await fresh cues after U.S. equities ended on a positive note, with the Nasdaq, Dow, and S&P posting healthy gains.
As the markets gear up for the day, Dow, S&P, and Nasdaq futures signal a positive start, while crude oil treads higher and Bitcoin experiences a modest retreat.
Worldwide, the FTSE 100 and DAX are on an upward trajectory, although Indian markets are closed for a holiday.
In premarket trading, Chinese stocks, including JD.com, Li Auto, Xpeng, Nio, Bilibili, and Netease, register significant losses, amplifying the ongoing selloff in the China stock market.
Lastly, economic observers keep a keen eye on the day’s calendar as market participants weigh the latest developments amidst the volatile backdrop.
Editor’s Note: This article covers one or more microcap stocks. Please be aware of the risks associated with these stocks.
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