Saks Surges on Buyout Rumors (SKS)

Saks Inc. SKS shares are higher by more than 22% Tuesday afternoon, after a news report suggested that a group of private equity firms might soon bid for the luxury department store operator. According to a Reuters report, "The Daily Mail, a British newspaper, said that a consortium of U.S. and British firms could make a cash offer of $11 per share, or $1.7 billion in all, for the company. The report did not cite sources or which firms might proffer a bid." A Saks spokeswoman said in an email that the company does not comment on rumors or speculation. Shares of the company are trading above $8 today, after closing below $7 on Monday. The Reuters report notes that "The chain, known for its flagship store on Manhattan's Fifth Avenue, has been the object of repeated takeover speculation in recent years, with media reports saying potential bidders included buyout firms Cerberus Capital Management CBS.UL and Britain's Permira PERM.UL.Its shares have languished with doubts about the pace of a U.S. economic recovery, though it says its core clientele of wealthy customers is still shopping its merchandise."