Macy's flagship store in Herald Square in New York, December 23, 2021.
Scott Milin | CNBC
Storage section Messi It said on Wednesday that it had settled its proxy battle with real estate investor Arkhouse, and that it would add two new directors to its 15-person board.
This reshuffle brings Macy's closer to a deal that could make the 165-year-old department store private.
Rick Clark, a former Brookfield executive, and Rick Markey will join Macy's Board of Directors effective immediately. Markee is also a member of the discount retailer's board of directors Five below. Both Clark and Markey were nominees for Arkhouse.
“The board is open about the best path to creating shareholder value,” the company said.
Macy's shares fell about 2% in early trading Wednesday.
Macy's also said it provided the Arkhouse-led investor group with confidential business information while the two sides negotiated terms for the potential sale. Both new directors will be part of the committee reviewing Arkhouse's bid for the company.
Arkhouse first made a bid to take the retailer private in 2023. Since then, the investor, working in coordination with Brigade Management, has increased its bid several times. The investment firm-turned-activist then launched a proxy fight with the company in February, putting forward a slate of nine directors.
Jonathan Blackwell and Gavriel Kahane, managing partners at Arkhouse, said the appointment of Clarke and Markey “will ensure that our discussions remain constructive and that our proposal is treated seriously and expeditiously.”
The popular retailer has struggled for nearly a decade as consumers quickly turned to online shopping and away from department stores. Macy's said in February that it would close about 150 of its nearly 500 stores, just weeks after CEO Tony Spring took the top job.
It has laid off thousands of people in recent years as the company grapples with a dramatically changing landscape.
Macy's has attracted activist attention before. Starboard Value, an established investor in the space, took a position in the retailer in 2015, then sold it two years later after a potential takeover fell through.
Arkhouse's offer differs from previous signings at the company. The real estate investor seeks to take the company private, extracting it from the difficulties of the public market and allowing time for executives to streamline and right the business, which still has a large real estate portfolio.
