Saturday, June 23, 2007

Is Macy's for sale?

I was downtown during the week and there was this guy handing around some bookmark sized flyers about saving Marshall Field's. On the front of this flyer is a web address and below that is boycott Macy's. I was thinking that this fight was about over even though I'm sure there were still people who are unhappy about the change and they weren't going to shop at those stores formerly known as Field's.

Then the Sun-Times has a story...
Rumors swirled Friday that Macy's could be sold to private-equity buyers this weekend, leading experts to speculate that Macy's flagship store on State Street could be shuttered and sold, or returned to its Marshall Field's origins.

Shares of Macy's, the Cincinnati-based owner of Macy's and Bloomingdale's stores, jumped as high as 10.3 percent (to $43.11) on Friday before ending the day up 6.6 percent at $41.43, on Wall Street rumors that it could fetch a bid of more than $30 billion.

The likely buyers, at a rumored $52 a share, were Kohlberg Kravis Roberts, the buyout firm famous for its takeover of RJR Nabisco in the 1980s, and Goldman Sachs Group, Macy's longtime investment banker.

Spokespeople for Macy's, KKR and Goldman Sachs declined comment.

Another rumor had Allen Questrom, the retail veteran who turned around JC Penney and mentored Macy's CEO Terry Lundgren, as involved in a takeover deal. Questrom, a senior adviser for Lee Equity Partners in New York, did not return a telephone call.

Macy's is an obvious choice for takeover because it has valuable real estate, steady cash flow, lagging sales in its newly converted Macy's stores, and undervalued shares that fail to reflect its value, experts said Friday.

"It's a big-name brand, a blue-chip asset in retail. It would be interesting for private equity to own," said Marc Weinberger, head trader at W. Quillen Securities in New York.

Retail expert Howard Davidowitz said new owners could sell the Macy's flagship on State Street for its tremendous real estate value, and further the breakup of big department stores on State Street. Carson Pirie Scott & Co. shuttered its 102-year-old flagship at 1 S. State St. in February, and the building is being divided for smaller, as-yet-unnamed retailers and entertainment uses.

Filene's historic flagship in Boston, shuttered last year by Macy's, was bought by a private-equity firm and is being converted into a multi-use building with specialty retailers, condos, hotel and office space.

New owners could also change Macy's back to Field's, said Frederick Schmitt, principal with the Sage Group in Los Angeles.
Carson, Pirie, Scott is certainly a sad case. A nice building shuttered and to be used but not as a department store as it had been since it was built.

It would be sad if it was decided to close the main Department store and for good at that. I miss those green bags, that they used to have. I still wonder about their decision to drop the Field's name from their stores.

Hopefully someone will come up with a good deal that will not result in the loss of job and the closing of even the historic department store on State Street.

1 comment:

JP Paulus said...

they ought to restore Marshall Field's -- they can get lots of positive publicity if they do so.

The Thillens Baseball Field in West Rogers Park is an example of HOW to do it.

The Thillens family had to sell the baseball park (for kids), after a 1/2 century tradition, due to costs...but the Cubs bought it, & worked out its use with the Chicago Park District.

They did some renovations to the park (new bleachers, etc.), added te Cubs logo & name everywhere, but kept the vital parts of te stadium (the Thillens sign , the basic format).

Those who had memories of the park can come back & reminence & kids of today can start their own memories.

That was a true win-win all around.

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