Kohl’s announced Friday (July 1) that it was ending negotiations to put itself up for sale, citing a financing and retail environment that had “significantly deteriorated.”
The company issued a statement saying its board had “unanimously determined that it was no longer prudent to continue its process” and that it was in the best interest of shareholders for Kohl’s to carry out its strategic plan alone.
The department store chain had recently received takeover bids from the private equity firm Sycamore Partners and retail holding company Franchise Group, which had initially offered a deal that would have valued Kohl’s at $60 per share.
See also: Kohl’s Gets 2 Competing Takeover Bids
Kohl’s said Friday it had spoken with 25 parties in total during the process, with Franchise Group ultimately emerging as the top bidder. But Peter Boneparth, chair of the Kohl’s board, said although both sides made a “concerted effort,” there were too many obstacles.
“Given the environment and market volatility, the board determined that it simply was not prudent to continue pursuing a deal,” he said.
For now, Kohl’s says it is committed to pursuing its growth strategy, which includes building on its partnership with beauty products company Sephora, which is set to expand to 850 stores by the end of next year. The company also plans to open another 100 smaller-format stores.
Last year saw Kohl’s urged by an activist investor to sell the company or at least spin off its eCommerce business. That push came around the same time as Macy’s was also being encouraged to shed its digital operations. Macy’s ultimately rejected that idea, saying it saw itself as a “digitally-led, omnichannel retailer.”
Kohl’s decision not to sell came days after Walgreens announced it would hold onto ownership of its British unit Boots and its cosmetics label No7. The sale would have been worth as much as $7.5 billion but garnered just one serious offer, from India’s Reliance Industries and U.S.-based private equity firm Apollo Global Management.
Ultimately, the company decided it was in the best interest of investors for Walgreens to keep pushing growth and profitability at Boots and No7, which had continued to perform well despite a tough economic climate.