JCPenney Offers $8.6B to Acquire Department Store Chain Kohl’s

The owners of retail department store chain JC Penney have made an offer to acquire its rival Kohl’s, in a deal that could value the latter company at upwards of $8.6 billion.

According to a report from The Post, under the proposal, shopping-mall giant Simon Property and Canada-based Brookfield Asset Management BAM.A, who both took JCPenney out of bankruptcy in December 2020, have offered to acquire Kohl’s for $68 a share.

One source told The Post that the plan is for JCPenney’s corporate parents to continue to maintain two separate brands while streamlining operations and cutting costs.

The bidders’ plan for Kohl’s is to slash costs by $1 billion over the next three years, said the source.

The Post has reached out to Simon Property Group and Brookfield Asset Management seeking comment.

It was earlier this year that Wisconsin-based Kohl’s had put itself up for sale after being urged by activist investors Macellum and Engine Capital, who were unhappy with the direction of the company.

Private equity giants Sycamore Partners and Leonard Green & Partners as well as Saks Fifth Avenue’s Canada-based parent company Hudson’s Bay are reportedly interested in acquiring Kohl’s.

According to Simon and Brookfield, a single management team would operate JCPenney and Kohl’s while merging the information technology systems so that one unit is in charge of the chains, according to a source.

The companies would also have all private apparel manufactured by the same in-house label, the source additionally added.

If the sale is complete, the new business would ditch plans to roll out Sephora concession stands inside Kohl’s locations, The Post reported.
As of now, there are just 689 JCPenney locations in operation.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.