Introduces Slate of Seasoned Leaders with the
Necessary Retail, Real Estate and Capital Markets Expertise to
Ensure the Board Explores All Potential Avenues to Maximize
Shareholder Value
In Light of Ongoing Delay Tactics and the
February 19th Director Nomination Deadline, Arkhouse Has Acted to
Protect the Rights of All Shareholders
Arkhouse Provided Clear Financing Details to
Macy’s, Disclosing Names of Highly Regarded Partners for 50% Equity
Component of Proposed Transaction
Arkhouse Management Co. LP (together with its affiliates,
“Arkhouse”, “we” or “us”), which has a 4.4% economic exposure in
Macy’s, Inc. (“Macy’s”, or the “Company”) (NYSE: M), today
announced it has nominated nine independent, highly qualified
candidates for election to the Company’s Board of Directors (the
“Board”) at the 2024 Annual Meeting of Shareholders (the “Annual
Meeting”).
Gavriel Kahane and Jonathon Blackwell, Arkhouse Managing
Partners, said:
“Arkhouse and its partner, Brigade Capital Management, submitted
a proposal on Dec. 1, 2023, to acquire all the outstanding shares
of Macy’s we didn’t already own for $21.00 per share. After more
than seven weeks of limited progress and the Board’s unwillingness
to meaningfully engage, our proposal was rejected over alleged
concerns about our financing sources and the purchase price.
We have persisted in our attempts to resolve any supposed
concerns privately with the Board since the Company’s rejection of
our proposal. To that end, we provided the Board with additional
details regarding our financing, including names of our highly
regarded equity partners – which have more than $75 billion in
combined assets under management – for the 50% equity component of
the transaction. We also reminded the Board that we remain
optimistic that we will be able to increase the proposed purchase
price based on customary due diligence, which the Company has
refused to grant us. Finally, we requested that the Board extend
the February 19th deadline for director nominations so that we
could continue to engage privately, which was also rejected,
forcing us to nominate directors.
The Board's history of poor performance and continued refusal to
engage constructively with our credible and motivated buyer group
have led us to the decision to nominate a slate of highly
qualified, independent directors to reconstitute Macy’s Board.
While we do not make this decision lightly, we did so to preserve
our ability to protect the rights of all shareholders. We firmly
believe that our slate of nominees possesses the necessary
backgrounds and expertise to evaluate all potential avenues to
unlock the substantial unrealized value at the Company that the
current directors appear unwilling to pursue. We urge the Board to
specifically identify any additional information they are seeking
regarding our financing so that we may alleviate any of their
outstanding concerns.”
Arkhouse’s nine-member slate of director candidates
includes:
Richard (Ric) Clark
Mr. Clark possesses nearly four decades of real estate,
mergers and acquisitions and capital markets experience that would
be extremely valuable to the Macy’s Board.
- Currently the Co-Founder and Managing Partner of WatermanCLARK,
a vertically integrated real estate investment and operating
company.
- Prior to that, spent three decades at Brookfield Corp. and its
predecessors (NYSE: BN), serving in various leadership roles,
including Chairman and Chief Executive Officer of Brookfield
Property Group, Brookfield Property Partners and Brookfield Office
Properties.
- Under his leadership, Brookfield’s real estate group grew its
assets under management from $5 billion to more than $200 billion
and expanded globally in office, multifamily, industrial, hotel and
retail real estate.
- Serves as Chairman of the Alliance for Downtown New York and
the Downtown-Lower Manhattan Association and serves on several real
estate executive committees.
- Holds a Bachelor of Science in Business from Indiana University
of Pennsylvania.
Richard L. Markee
Mr. Markee has extensive retail leadership experience both as
CEO and as a director on numerous public company boards, which
would be extremely valuable to the Macy’s Board.
- Currently serves on the board of Five Below, Inc. (NASDAQ:
FIVE).
- Previously served in various roles at Vitamin Shoppe, Inc.,
including as Non-Executive Chairman, Executive Chairman and Chief
Executive Officer.
- Also held senior positions at Toys “R” Us, Inc., including Vice
Chairman, and President of Babies “R” Us and Toys “R” Us U.S.
- Previously served as a director of Collective Brands, Inc., the
Sports Authority, Inc., Dorel Industries Inc. (TSX: DII.B) and Pet
Supplies Plus.
- Holds a Bachelor of Arts from the University of Wisconsin.
Mohsin (Mo) Y. Meghji
Mr. Meghji is a nationally recognized turnaround professional
with over three decades of experience reviving companies
experiencing financial, operational or strategic transitions that
would be extremely valuable to the Macy’s Board.
- Currently the Managing Partner and Chief Executive Officer of
M3 Partners.
- Served as the Chief Restructuring Officer of Sears Holdings
Corp. and Barneys Inc., among others.
- Previously served as a director on the board of Macy’s PropCo
Holdings, LLC, as well as a board member of Frontier Communications
Parent, Inc. (NASDAQ: FYBR), Toys “R” Us, Inc., Philadelphia Energy
Solutions Refining and Marketing LLC, Shopko Stores Operating Co,
LLC and others.
- Graduate of the Schulich School of Business at York University
and has taken executive courses at INSEAD. Qualified as a UK and
Canada Chartered Accountant and a U.S. Certified Turnaround
Professional.
Mitchell Schear
Mr. Schear has more than 40 years of leadership, technology,
innovation, real estate development, management and investing
experience at both public and private companies that would be
extremely valuable to the Macy’s Board.
- Founder of Ten Square, a real estate focused investment firm
for start-ups and venture capital funds.
- Previously served as President of real estate companies
Vornado/Charles E. Smith and the Kaempfer Co., as well as the
Executive Partner at venture capital firm Camber Creek.
- Served as a trustee at real estate investment trust JBG Smith
Properties (NYSE: JBGS), and on numerous other public and private
boards, task forces and advisory committees, including the
Facilities Committee of the Smithsonian Institution’s Board of
Regents and the Virginia Governor’s Revenue Commission.
- Holds a Bachelor’s Degree from Hobart and William Smith
Colleges and a Master of Business Administration from George
Washington University.
Nadir Settles
Mr. Settles has significant expertise in real estate and
sustainable investing and extensive experience in operations,
innovation, and business and product development that would be
extremely valuable to the Macy’s Board.
- Currently Global Head of Impact Investing at Nuveen Real
Estate, one of the largest investment managers in the world. Also
serves as Head of Investments for the New York MSA for
opportunistic value-add investments.
- Has served on the Board of Governors for the Real Estate Board
of New York and the Citizens Housing and Planning Council.
- Prior to that, was involved in asset management and
acquisitions at Silverstein Properties Inc. and RLJ Lodging Trust
(NYSE: RLJ).
- Holds a Bachelor of Arts in business from St. John’s
University, a Master of Business Administration from Villanova
School of Business and a Master of Science in Real Estate Finance
from New York University.
Gerald (Jerry) L. Storch
Mr. Storch is a seasoned executive known for pioneering
e-commerce at retailers and has significant public company
leadership experience that would be extremely valuable to the
Macy’s Board.
- Currently the Chief Executive Officer of Storch Advisors, a
consulting firm specializing in retail.
- Former Chief Executive Officer and director of Hudson’s Bay Co.
and former Vice Chairman of Target Corp. (NYSE: TGT).
- Currently serves on the board of Bristol Myers Squibb Co.
(NYSE: BMY) and Fanatics, a large private e-commerce and sports
platform.
- Previously held the positions of Chairman and Chief Executive
Officer of Toys “R” Us, Inc., and non-executive chairman of
SUPERVALU Inc.
- Earlier in his career, worked at McKinsey & Co. with a
focus on consumer goods and financial services.
- Holds a Master of Business Administration from Harvard Business
School, a Bachelor of Arts in Economics from Harvard College and a
Doctor of Law from Harvard Law School.
Sharen J. Turney
Ms. Turney is a seasoned retail executive with more than 30
years of experience growing world-class brands and launching
e-commerce businesses across department, luxury and specialty
concepts that would be extremely valuable to the Macy’s
Board.
- Former Chief Executive Officer of Victoria’s Secret and
Victoria’s Secret Direct, the brand’s catalogue and e-commerce
business.
- Previously served as Chief Executive Officer of fashion
retailers Gloria Jeans and Neiman Marcus Direct.
- Currently serves as an independent director at Paycom Software,
Inc. (NYSE: PAYC) and Academy Sports and Outdoor Inc. (NASDAQ:
ASO).
- Has served as an advisor to several retailers and technology
companies and previously served on the boards of Happy Socks AB,
M/I Homes Inc. (NYSE: MHO), and FULLBEAUTY Brands.
- Holds a Bachelor of Arts degree in business education from the
University of Oklahoma.
Andrea M. Weiss
Ms. Weiss has more than 35 years in executive roles in the
consumer and fashion industry and has extensive experience in
marketing, consumer behavior, global retail, e-commerce and brand
development that would be extremely valuable to the Macy’s
Board.
- Co-founder of consulting firm The O Alliance LLC and an
independent director at O’Reilly Automotive Inc. (NASDAQ: ORLY) and
Premier Investments LLC (PMV.AX), a holding company for multiple
fashion brands and retail concepts.
- Held senior leadership roles at well-known retailers Ann
Taylor, Bath & Body Works Inc. (NYSE: BBWI), Guess? Inc. (NYSE:
GES) and L Brands and was the executive Chairwoman of Grupo
Cortefiel in Spain.
- Previously served on the board of Cracker Barrel Old Country
Store, Inc. (NASDAQ: CBRL) and was a trustee at RPT Realty.
- Holds a Bachelor of Fine Arts from Viriginia Commonwealth
University and holds a Master of Business Administration from Johns
Hopkins Business School with post-graduate studies at Harvard
University and Northwestern University.
Isaac Zion
Mr. Zion has decades of experience in executive management,
investments and transactions that would be extremely valuable to
the Macy’s Board.
- Currently Managing Principal at Acram Group, a real estate
investment, development and management firm for mixed-use
properties across the U.S.
- Prior to Acram, served as co-Chief Investment Officer of SL
Green Realty Corp. (NYSE: SLG), where he played a significant role
in executing public-private partnerships between SL Green, the City
of New York and the MTA, and was a key investment professional
behind the development of One Vanderbilt.
- Earlier in his career, held senior positions at Tishman Speyer
and Insignia/ESG Consulting Group.
- Member of the Real Estate Board of New York, the Urban Land
Institute and other philanthropic endeavors.
- Holds a Bachelor of Science in management and finance from
Binghamton University and a Master of Business Administration from
New York University.
Advisors
Cadwalader, Wickersham & Taft LLP is serving as legal
counsel and Longacre Square Partners is serving as strategic
advisor to Arkhouse. Morrow Sodali is serving as proxy advisor.
Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as
legal counsel and Jefferies LLC is serving as financial advisor to
the buyer group.
About Arkhouse
Arkhouse is a New York-based investment firm that takes a
private equity approach to investing in the public markets.
Arkhouse focuses on M&A strategies to unlock value dislocations
created by the mispricing of assets across public and private
markets. Arkhouse’s team of professionals consists of real estate
and public equity specialists who have closed more than $25 billion
worth of real estate transactions and have an 18-year shareholder
activism track record.
Cautionary Statement Regarding Forward-Looking
Statements
This press release does not constitute an offer to sell or
solicitation of an offer to buy any of the securities described
herein in any state to any person. The information herein contains
“forward-looking statements”. Specific forward-looking statements
can be identified by the fact that they do not relate strictly to
historical or current facts and include, without limitation, words
such as “may,” “will,” “expects,” “believes,” “anticipates,”
“plans,” “estimates,” “projects,” “potential,” “targets,”
“forecasts,” “seeks,” “could,” “should” or the negative of such
terms or other variations on such terms or comparable terminology.
Similarly, statements that describe our objectives, plans or goals
are forward-looking. Forward-looking statements are subject to
various risks and uncertainties and assumptions. There can be no
assurance that any idea or assumption herein is, or will be proven,
correct or that any of the objectives, plans or goals stated herein
will ultimately be undertaken or achieved. If one or more of such
risks or uncertainties materialize, or if Arkhouse’s underlying
assumptions prove to be incorrect, the actual results may vary
materially from outcomes indicated by these statements.
Accordingly, forward-looking statements should not be regarded as a
representation by Arkhouse that the future plans, estimates or
expectations contemplated will ever be achieved.
Certain Information Concerning the Participants
Arkhouse Value Fund I LP (“Arkhouse Value
Fund I”) and the other Participants (as defined below)
expect to file a preliminary proxy statement and accompanying
universal proxy card with the Securities and Exchange Commission
(the “SEC”) to be used to solicit proxies for, among other matters,
the election of its slate of director nominees to the Board at the
Annual Meeting. Promptly after filing its definitive proxy
statement with the SEC, Arkhouse Value Fund I LP expects to mail
the Participants’ definitive proxy statement and accompanying
universal proxy card to each stockholder entitled to vote at the
Annual Meeting.
The participants in the proxy solicitation are Arkhouse Value
Fund I, Arkhouse Value Fund II LP (“Arkhouse
Value Fund II”, and together with Arkhouse Value Fund I, the
“Arkhouse Value Funds”), Arkhouse
Co-Investment III LP (“Arkhouse Co-Investment
III”), Arkhouse Equity Investors LLC (“Arkhouse Equity Investors”), Arkhouse Equities
Fund LLC (“Arkhouse Equities Fund”,
and together with the Arkhouse Value Funds, Arkhouse Co-Investment
III and Arkhouse Equity Investors, the “Arkhouse Stockholders”), Arkhouse Value Fund GP
LLC (“Arkhouse Value Fund GP”),
Arkhouse Co-Investment III GP LLC (“Arkhouse
Co-Investment III GP”), Arkhouse Real Estate Activism Fund
MM LLC (“Arkhouse MM”), Arkhouse
Manager LLC (“Arkhouse Manager”),
Arkhouse Management Co. LP (“Arkhouse
Management”), Arkhouse GP LLC (“Arkhouse GP”), Jonathon Blackwell, Gavriel Kahane
and George Hebard (all of the forgoing persons, together, the
“Arkhouse Parties”), along with the
nominees (the “Nominees”) Richard
Clark, Richard L. Markee, Mohsin Y. Meghji, Mitchell Schear, Nadir
Settles, Gerald L. Storch, Sharen J. Turney, Andrea M. Weiss and
Isaac Zion (the Arkhouse Parties and the Nominees, collectively,
the “Participants”).
As of the date hereof, Arkhouse Parties in the aggregate
directly own or have the right to acquire within 60 days 4,021,687
shares of common stock of Macy’s, par value $0.01 per share (the
“Common Stock”) and hold long
positions in cash-settled American call options referencing a
further 17,014,610 shares of Common Stock, in each case as further
detailed below. As of the date hereof, (i) Arkhouse Value Fund I
directly holds 2,750,880 shares of Common Stock, comprised of 1,000
shares of Common Stock held in record name and 2,749,880 shares of
Common Stock held in “street name”, and holds long positions in
cash-settled American call options referencing a further 15,947,798
shares of Common Stock; (ii) Arkhouse Value Fund II directly holds
155,952 shares of Common Stock in “street name”, and holds long
positions in cash-settled American call options referencing a
further 1,066,812 shares of Common Stock; (iii) Arkhouse
Co-Investment III directly holds 447,898 shares of Common Stock in
“street name”, (iv) Arkhouse Equity Investors directly holds 70,527
shares of Common Stock in “street name”; (v) Arkhouse Equities Fund
directly holds 416,430 shares of Common Stock in “street name”, and
also directly holds 1,800 American call options currently
exercisable for 180,000 shares of Common Stock; (vi) Arkhouse Value
Fund GP, as the general partner of each of the Arkhouse Value
Funds, may be deemed to beneficially own all of the 2,906,832
shares of Common Stock beneficially owned in aggregate by the
Arkhouse Value Funds; (vii) Arkhouse Co-Investment III GP, as the
general partner of Arkhouse Co-Investment III, may be deemed to
beneficially own all of the 447,898 shares of Common Stock
beneficially owned by Arkhouse Co-Investment III; (viii) Arkhouse
MM, as the manager of Arkhouse Equities Fund, may be deemed to
beneficially own all of the 596,430 shares of Common Stock
(including the 180,000 shares of Common Stock underlying the 1,800
American call options held by Arkhouse Equities Fund) beneficially
owned by Arkhouse Equities Fund; (ix) Arkhouse Manager, as the
managing member of Arkhouse MM and manager of Arkhouse Equity
Investors, may be deemed to beneficially own all of the 596,430
shares of Common Stock beneficially owned by Arkhouse MM and all of
the 70,527 shares of Common Stock beneficially owned by Arkhouse
Equity Investors; (x) Arkhouse Management, as the investment
manager to each of the Arkhouse Stockholders, may be deemed to
beneficially own all of the 4,021,687 shares of Common Stock
(including the 180,000 shares of Common Stock underlying the 1,800
American call options held by Arkhouse Equities Fund) beneficially
owned in aggregate by the Arkhouse Stockholders; (xi) Arkhouse GP,
as the general partner of Arkhouse Management, may be deemed to
beneficially own all of the 4,021,687 shares of Common Stock
(including the 180,000 shares of Common Stock underlying the 1,800
American call options held by Arkhouse Equities Fund) beneficially
owned in aggregate by Arkhouse Management; (xii) Mr. Blackwell, as
the managing member of Arkhouse GP, Arkhouse Co-Investment III GP,
Arkhouse Value Fund GP and Arkhouse Manager, may be deemed to
beneficially own all of the 4,021,687 shares of Common Stock
(including the 180,000 shares of Common Stock underlying the 1,800
American call options held by Arkhouse Equities Fund) beneficially
owned in aggregate by Arkhouse GP, Arkhouse Co-Investment III GP,
Arkhouse Value Fund GP and Arkhouse Manager; (xiii) Mr. Kahane,
through his status as a member of Arkhouse GP, Arkhouse
Co-Investment III GP, Arkhouse Value Fund GP and Arkhouse Manager,
may be deemed to beneficially own all of the 4,021,687 shares of
Common Stock (including the 180,000 shares of Common Stock
underlying the 1,800 American call options held by Arkhouse
Equities Fund) beneficially owned in aggregate by Arkhouse GP,
Arkhouse Co-Investment III GP, Arkhouse Value Fund GP and Arkhouse
Manager; and (xiv) Mr. Hebard directly holds 140,000 shares of
Common Stock in “street name”, and may be deemed to beneficially
own a further 6,500 shares of Common Stock. As of the date hereof,
none of the Nominees own beneficially or of record any shares of
Common Stock.
IMPORTANT INFORMATION AND WHERE TO FIND IT
ARKHOUSE STRONGLY ADVISES ALL STOCKHOLDERS OF MACY’S TO READ
BOTH THE PARTICIPANTS’ PROXY STATEMENT AND MACY’S’ PROXY STATEMENT
AND OTHER PROXY MATERIALS AS THEY BECOME AVAILABLE BECAUSE THEY
WILL CONTAIN IMPORTANT INFORMATION. SUCH PROXY MATERIALS WILL BE
AVAILABLE AT NO CHARGE ON THE SEC’S WEBSITE AT WWW.SEC.GOV. THE
PARTICIPANTS’ DEFINITIVE PROXY STATEMENT, WHEN FILED, AND OTHER
RELEVANT DOCUMENTS, WILL ALSO BE AVAILABLE ON THE SEC WEBSITE, FREE
OF CHARGE. IN ADDITION, THE PARTICIPANTS WILL PROVIDE COPIES OF THE
PROXY STATEMENT WITHOUT CHARGE, WHEN AVAILABLE, UPON REQUEST.
REQUESTS FOR COPIES SHOULD BE DIRECTED TO THE PARTICIPANTS’ PROXY
SOLICITOR, MORROW SODALI LLC (STOCKHOLDERS CAN CALL TOLL-FREE: +1
(800) 662-5200).
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version on businesswire.com: https://www.businesswire.com/news/home/20240220706794/en/
For Investors: Morrow Sodali LLC Geoffrey Weinberg / Paul
Schulman / Jonathan Eyl 1 (800) 662-5200
Macys@info.morrowsodali.com For Media: Longacre Square Partners
Scott Deveau / Joe Germani arkhouse@longacresquare.com
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