Kohl’s Gets $9 Billion Bid 37% Above Market from Activist Hedge Fund

Department store chain Kohl’s Corp received an unsolicited offer from activist hedge fund Starboard Value LP to buy the company Friday. The WSJ reported that sources disclosed a group led by a group controlled by Starboard, Acacia Research Corp. offered to buy Kohl’s for $64 a share in cash. Acacia said it has received assurances from bankers it has financing for the bid. Reuters reported earlier this week that Acacia was exploring a possible bid for Kohl’s.

Kohl’s $KSS shares closed at $46.84 Friday. The bid represents a 37% premium. The stock has a 52 Week High / Low of $64.8/$42.68.

Earlier this week Kohl’s said plied that its strategy is producing results and that its board “regularly works with specialized advisers to evaluate paths that have the potential to create long-term value.” Kohl’s added it plans to unveil its strategic plans at an investor day in March.

Two activist shareholders have been pressuring the company for a while, Macellum Advisors GP LLC and Engine Capital LP have called on $KSS to look at putting itself on the chopping block. Macellum said in an open letter to Kohl’s shareholders Tuesday it has been pushing the company to add additional directors with retail experience or to hire bankers to explore a sale.

Starboard invested in Acacia and joined its board in 2019. Acacia has a market value of just $215 million. In October Acia bought privately held Printronix Holding Corp for $33 million, and it has made offers for other companies including Comtech Telecommunications Corp.

In its bid WSJ reported that it told Kohl’s it received what is known as a “highly confident” letter from a bank asserting that it will be able to attain a debt-financing package for a portion of the bid, the people said. While such letters are no guarantee, they can be a meaningful vote of confidence.

About Kohl’s

Kohl’s is a leading omnichannel retailer with more than 1,100 stores in 49 states. With a commitment to inspiring and empowering families to lead fulfilled lives, Kohl’s offers amazing national and exclusive brands, incredible savings and an easy shopping experience in our stores, online at Kohls.com and on Kohl’s mobile app. Since its founding, Kohl’s has given more than $750 million to support communities nationwide, with a focus on family health and wellness. For a list of store locations or to shop online, visit Kohls.com.

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