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Kate Spade Looking Into Strategic Alternatives, Including Selling Itself

Kate Spade Looking Into Strategic Alternatives, Including Selling Itself
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Shares of apparel and fashion maker Kate Spade & Co (NYSE: KATE) jumped more than 10 percent on Thursday after the company confirmed what media reports have been suggesting over the past few months, namely the company is exploring a sale of itself.

A Bloomberg report dated December 29, 2016, cited sources close to the matter and reported that Kate Spade is planning to kick off a formal sale process in the very near-term and there are at least six potential bidders.

Kate Spade has been under heavy pressure from activist investor and large shareholder Caerus Investors to implement strategic alternatives, including possibly selling itself.

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Wall Street also analyzed a potential deal and analysts at SunTrust suggested the price tag on a sale of Kate Spade could be as high as $23 per share.

Kate Spade Confirms

Until Thursday, Kate Spade hadn't publicly confirmed it is indeed on the hunt for a potential buyer.

In conjunction with the company's fourth-quarter earnings report, Kate Spade confirmed it has hired financial advisers and consultants to evaluate strategic alternatives to enhance shareholder value.

Kate Spade did, however, caution that there is no timetable for the completion of the process and there are no assurances that the review process will result in any transaction.

Management added that it won't update investors with any developments or updates until any additional disclosures or appropriate or required. Also, no forward-looking guidance will be provided.

At last check, shares of Kate Spade were up 11.49 percent at $21.93.

Image Credit: By Kate Spade ( [Public domain], via Wikimedia Commons

Posted-In: Apparel apparel stocks BloombergEarnings News M&A Movers Media Best of Benzinga


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