Retail Giant Kohl's Gets $9B Bid From Activist Hedge Fund Starboard Value: Report

A consortium backed by activist hedge fund Starboard Value LP is offering about $9 billion for retailer Kohl's Corporation KSS, according to a Wall Street Journal report. 

People familiar with the developments tell WSJ that Acacia Research Corp ACTG has led the offer, an effort spearheaded by CEO Clifford Press. 

Controlled by Starboard Value LP, Acacia Research Corp offered to buy the department-store chain for $64 a share in cash Friday. 

Acacia told the retailer (the largest department store chain in the U.S. with 1,158 locations) it has received assurances from bankers that there is sufficient financing for the bid, according to sources.

Before Starboard invested in Acacia and joined its board in 2019, the company was primarily a holding company for patents.

Kohl’s shares closed at $46.84 Friday. The bid represents a 37% premium.

Activists have proposed that Kohl’s explore sale-leasebacks of its real estate, which they have estimated could be worth $7 billion or more.

According to the report, Kohl’s management is under fire from activist investor Macellum Advisors, which has been urging Kohl’s to make board changes or consider a sale in a letter to shareholders in recent weeks.

Also Read: This Is What Whales Are Betting On Kohl's

Last year, in March, Macellum was pushing to appoint a slew of executives to Kohl’s board after initially asking for control of the company. 

WSJ quoted Kohl’s saying 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.”

Photo: Courtesy of Mike Mozart on Flickr