NEW YORK - Macy's, Inc. (NYSE:M) has initiated a tender offer to repurchase up to $220 million of its outstanding notes. The offer, made through its subsidiary Macy's Retail Holdings, LLC, targets several series of notes with varying interest rates and maturities, prioritizing the purchase in an order detailed in the company's statement.
The tender offer, which began on Wednesday, includes an early tender premium for notes tendered before the early deadline of 5:00 p.m., New York City time, on September 17, 2024. The total consideration for these early tenders will include this premium, in addition to the tender offer consideration minus the early tender premium for each series of notes. Holders who tender their notes after this deadline but before the expiration date will receive only the tender offer consideration.
The purchase of notes is subject to certain conditions outlined in the Offer to Purchase. The offer is not contingent on a minimum amount of notes being tendered but may be amended, extended, or terminated by Macy's. The expiration date is set for 5:00 p.m., New York City time, on October 2, 2024, unless an extension or early termination occurs.
If the aggregate principal amount of notes tendered and not withdrawn exceeds the maximum tender offer amount, Macy's may accept notes on a prorated basis, with equal proration for notes of the same acceptance priority level.
Additionally, Macy's will pay accrued and unpaid interest up to, but not including, the applicable settlement date for all validly tendered notes accepted for purchase. The early settlement date is expected to be as soon as September 19, 2024, with the final settlement date anticipated to be October 4, 2024, assuming the maximum tender offer amount is not purchased on the early settlement date.
The tender offer is supported by Wells Fargo (NYSE:WFC) Securities, BofA Securities, US Bancorp (NYSE:USB), and UBS Investment Bank as dealer managers, with Global Bondholder Services Corporation acting as the tender and information agent.
This press release does not constitute an offer to purchase or a solicitation of an offer to sell the notes. The tender offer is made solely by the Offer to Purchase, and the information herein is qualified by reference to such document.
The information is based on a press release statement from Macy's, Inc.
In other recent news, Macy's Inc. (NYSE:M) announced a regular quarterly dividend of 17.37 cents per share for shareholders, continuing its practice of providing returns to investors. The company also revealed a mixed financial picture in its second quarter 2024 earnings with a 1% comp sales gain at top-performing stores, a strong gross margin expansion, but a 3.8% decline in net sales and a 3.3% decline in overall comps. Analysts noted that luxury segments, Bloomingdale's and Bluemercury, reported better-than-expected sales.
Despite facing a challenging market, Macy's plans to close approximately 55 stores this year, shifting focus towards more profitable locations. The company expects full-year net sales to range between $22.1 billion and $22.4 billion, with adjusted diluted EPS for the third quarter projected to range from a loss of $0.04 to earnings of $0.01.
In terms of future developments, Macy's is planning to open 100 more stores in the shoe and handbag categories and is optimistic about its holiday assortment's potential to capture a larger market share in Q4. These recent developments reflect the company's strategy for sustainable, profitable growth amidst current retail challenges.
InvestingPro Insights
As Macy's, Inc. (NYSE:M) announces its tender offer to repurchase outstanding notes, it's critical for investors to keep a pulse on the company's financial health and market position. According to InvestingPro, Macy's is projected to have a net income growth this year, which could signal a strengthening financial position that supports such strategic moves. Furthermore, the company's stock price has shown notable volatility, which investors might consider when evaluating the timing of their investment decisions in relation to the tender offer and other market activities.
Looking at the latest metrics from InvestingPro, Macy's has a market capitalization of $4.23 billion, which positions it as a prominent player in the Broadline Retail industry. The P/E ratio stands at 22.77, reflecting the market's valuation of its earnings. Additionally, Macy's has upheld its commitment to shareholders by maintaining dividend payments for 22 consecutive years, with a current dividend yield of 4.49%. This track record might appeal to income-focused investors, especially in the context of the tender offer announcement.
For those seeking more in-depth analysis, InvestingPro offers additional tips on Macy's, Inc. that can provide further clarity on the company's prospects. For instance, there are seven analysts who have revised their earnings predictions downwards for the upcoming period, which could be a factor to consider. To explore these insights and more, investors can visit https://www.investing.com/pro/M, where they can find a total of 8 InvestingPro Tips that delve into Macy's financial outlook and market presence.
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