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JCPenney Owners Reportedly Make a Bid to Acquire Kohl’s

The bidding war for Kohl’s is heating up.

The owners of department store chain JCPenney have reportedly made an offer to acquire Kohl’s. According to a report in the New York Post, the proposed deal comes from Simon Property and Brookfield Asset Management, the two entities that bought JCPenney out of bankruptcy in 2020 for $1.75 billion. The deal values Kohl’s at more than $8.6 billion, or $68 per share.

Kohl’s shares were up 3% in the early afternoon on Monday, following the report, which cited “sources close to the talks.” The report also said that Simon Property and Brookfield Asset Management would help Kohl’s cut $1 billion worth of costs over three years while still being run under the Kohl’s banner.

Simon Property, Brookfield Asset Management and Kohl’s did not immediately return FN’s request for comment.

The news represents the latest high-profile takeover bid from an entity looking to acquire Kohl’s.

In March, Kohl’s confirmed that it was weighing offers from multiple parties that were interested in purchasing the company. Macellum Advisors, which owns nearly 5% of shares at Kohl’s, has expressed skepticism about the future of the company and has asked Kohl’s to consider taking an offer to sell its business.

Kohl’s hired Goldman Sachs to engage with potential bidders and discuss alternatives for the business. The company said in a letter to shareholders that it has engaged with over 20 parties regarding non-binding proposals that are without financial commitment.

Earlier this month, Kohl’s reportedly received a takeover bid from Franchise Group, the owner and operator of retail chains such as The Vitamin Shoppe, Buddy’s Home Furnishings, and Pet Supplies Plus. The company reportedly placed a $9 billion offer to acquire the retail chain, Reuters reported.

HBC’s Hudson’s Bay Co., which owns Hudson’s Bay and Saks, also reportedly entered the race for Kohl’s in March with a bid of at least $70 per share, Reuters reported.

In February, Kohl’s rejected two takeover bids, noting that the offers  “do not adequately reflect the company’s value in light of its future growth and cash flow generation.”

Private equity firm Sycamore, which had previously been cited as a potential contender, expressed that it was looking to pay around $65 per share for Kohl’s, CNBC reported in February. Acacia Research also reportedly offered to pay about $64 a share for the department store chain.

“An offer for Kohl’s by Simon and Brookfield would be an interesting development in the battle for the department store chain,” said Neil Saunders, managing director of GlobalData, in a statement. “On the surface, the offer would be far more attractive than other bids on the table, if only because Simon and Brookfield would continue to run Kohl’s as a retailer and would bring some of their retail and operational expertise to the chain.”

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