Kohl’s Stores Considers Going Private or Breaking Up

Well, this is interesting.

I shop Kohl's a lot, as does my wife.

At WSJ, "Kohl’s Weighs Next Steps as Woes Mount":

Department stores have been under siege for decades, but lately their fortunes have hit a new low that could spark a wave of deal making that could sweep up companies such as Kohl’s Corp.

Shoppers are flocking to newer types of stores that sell similar brands at deep discounts and buying more online, leaving behind cavernous stores that are difficult to fill productively. Investors, too, are abandoning the companies. Shares of major department-store chains fell nearly 37% last year, while the overall S&P 500 Index fell just 0.7%.

The troubles are prompting some soul searching at these decades-old businesses. With sales shrinking, Sears Holdings Corp. has been selling off stores to raise cash. Macy’s Inc. is talking with real-estate developers to take over space in its flagship locations and other stores.

Kohl’s, a national department-store chain with roughly 1,200 stores, is debating whether to pursue more drastic action, such as taking itself private or breaking up the company, according to a person familiar with the situation.

Once among the fastest-growing retailers, the Menomonee Falls, Wisc.-based retailer has stumbled in recent years. Despite improvements that include recent sales gains at existing stores, its shares are down 40% from their high of $79.07 on April 2. It ended Friday with a market value of $9 billion, or roughly half its expected annual sales for the current fiscal year.

Concerned that its depressed share price could make it a target for activist investors, directors are considering whether to hire an investment bank to advise it on alternatives that could include a sale to a private-equity firm, the person familiar with the situation said.

The discussions are preliminary and directors might opt not to explore such a strategy. Kohl’s top executives are open to the strategic review and the board is expected to discuss the company’s multiple options further this week,  the person continued. A sale to a private-equity firm is an idea that management has rejected in the past despite interest from such firms, people familiar with the situation said. Kohl’s declined to comment...

Hmm... Wouldn't want activist investors to launch a power grab, heh.

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