JCPenney owners Simon Property and Brookfield Asset Management are reportedly looking to close an acquisition deal for Kohl’s that values the retail rival at an estimated $8.6 billion, The New York Post reported, citing unnamed sources with insider information.
Simon and Brookfield, two of the biggest mall owners in the US, bought JCPenney out of bankruptcy in 2020.
Under the proposal, both firms would pick up Kohl’s for $68 a share, sources close to the talks told NYP. Kohl’s shares on Monday closed at $60.39, up 5.3 percent.
If the deal goes through, both JCPenney and Kohl’s would operate as independent brands with the goal of streamlining operating overhead and other expenses. One source told NYP that Simon and Brookfield aim to cut Kohl’s costs by $1 billion by 2025.
Simon Property Group and Brookfield Asset Management didn’t immediately respond to requests for comments, per the NYP.
Headquartered in Menomonee Falls, Wisconsin, Kohl’s put itself up for sale earlier this year when activist investors Macellum and Engine Capital kicked up the conversation stating they weren’t happy with the direction of the retailer.
Kohl’s has had numerous acquisition inquiries, including reported interest from private equity firms Sycamore Partners and Leonard Green & Partners as well Hudson’s Bay, the Canadian parent of Saks Fifth Avenue, per the NYP.
Goldman Sachs is reportedly going to head up the possible sales process.
Headquartered in Plano, Texas, JCPenney was one of the dozens of retailers almost killed by the COVID-19 pandemic when in-person shopping was largely shuttered and the pivot to digital-first quickly became the norm.
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