Bidding for Kohl’s Reportedly Cools as Lenders Are Put Off by Q1 Results
The deal to sell department store Kohl’s might have hit some hurdles due to financing troubles, Seeking Alpha reported Saturday (May 21).
The deal cannot get financing in the $60 per share range, according to an anonymous source cited by CNBC, and lenders reportedly don’t have confidence in Kohl’s after the company reported its Q1 results. That said, no one has walked away from the deal yet.
This comes after another anonymous source reportedly told the NY Post that they were been “shocked” by Kohl’s results, and said there were not likely to be any acceptable bids offered from here on out. Additionally, a third source told the publication that deals were scarce amid the current environment, which is not likely to yield any big bank financings of large acquisitions.
There have also been recent reports that Kohl’s, which has been mulling a sale for some time, might end up staying independent. Company Chairman Peter Boneparth is also reportedly against selling the chain.
PYMNTS wrote last week that Kohl’s partnership with makeup giant Sephora was a seeming bright spot on its otherwise troubled results.
See also: Kohl’s Bets It All on Sephora as Final Buyout Bids Come In
“The transformation underway in our stores, with our partnership with Sephora as a cornerstone, is driving impressive results,” CEO Michelle Gass said. “It is again important to note that while the build out of the Sephora shop-in-shops is at the core of the store remodels, these 200 stores — soon to be 600 by the end of summer — are a representation of the future of Kohl’s.”
She also listed numerous benefits that are being seen from the stores focusing on the Sephora team-ups, such as positive comps, better basket sizes and more buying in other departments — along with new, younger and more diverse customers.
Gass said Sephora customers had been shopping “nearly twice as often” as other customers, and added that the new stores were working towards creating a solid future for the company.