After conducting a review with its independent financial advisors and upon recommendation from its finance committee, Kohl’s board of directors determined the valuations in the takeover bids do not reflect the true value of the company. Kohl’s said the bids undervalued the company’s “future growth and cash flow generation.”
The statement comes after the retailer received two bids from private-equity and investment firms looking to take the company private. In January, private-equity firm Sycamore offered $65 per share in a buyout bid––a 39% premium on the company’s share price. Days before that Acacia Research, backed by Starboard Value, offered $64 per share for Kohl’s.
Kohl’s board will continue an ongoing review of any expressions of interest for a takeover bid through its finance committee, which is made up exclusively of independent directors. Goldman Sachs and PJT Partners have also been engaged as financial advisors.
“We have a high degree of confidence in Kohl's transformational strategy, and we expect that its continued execution will result in significant value creation,” Kohl’s Chairman Frank Sica said in a statement. “The board is committed to acting in the best interest of shareholders and will continue to closely evaluate any opportunities to create value.”
At the same time as the statement on the bids, Kohl’s adopted a limited-duration shareholder rights plan, effective immediately and expiring Feb. 23, 2023. The plan aims to ensure the board of directors can conduct an orderly review of expressions of interest, including potential further engagement with interested parties. Kohl’s also plans to distribute dividends to its shareholders Feb 14, 2022, and has scheduled an investor day on March 7, 2022.