Macy’s has put an end to the buyout talks with activist investors Arkhouse Management and Brigade Capital. The discussions, aimed at taking the department store chain private in a $6.9 billion deal, failed to reach a conclusion owing to uncertainties around financing and valuation.

Macy’s stock took a significant hit, dropping 13% to $16.62 from $19.09 following the announcement. This development puts Macy’s turnaround strategy in the spotlight. Under CEO Tony Spring, the company plans to close 25% of its retail locations and enhance the shopping experience for customers.

In December 2023, Arkhouse and Brigade offered $5.8 billion, or $21 per share. The bid was rejected by Macy’s, leading to Arkhouse’s proxy fight in February to appoint nine new directors. Rapid negotiations followed, with the firms raising their offer to $24.80 per share by June. However, Macy’s board found the proposal lacking in coherence and financial certainty.

To create shareholder value, Macy’s will focus on its “Bold New Chapter” strategy, highlighted by Paul Varga, lead independent director. Despite the early phase, CEO Tony Spring expressed confidence about the positive traction the new initiatives are garnering.

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