Saks’s PE Takeover Rumors Are False

Remember all those rumors about a conglomerate of PE firms looking to buy Saks? They’re likely false, peHUB has learned.

Late last month, the Daily Mail reported that a consortium of U.S. and British firms may make a cash offer of $11 a share, or $1.7 billion for the company. The story caused Saks stock to surge nearly 22%. The story didn’t name any PE firms specifically but no matter. These reports are untrue, bankers and PE execs say.

I don’t have any idea why someone would float such rumors outside of the obvious. Saks’s stock jumped because of the rumors and the reports could spur a PE firm to really consider buying the retailer. Saks’s shares closed at $6.60 on Aug. 30, the day before the report came out. The next day, shares rocketed 34% to hit $8.85 before closing at $7.90. Saks’s stock was trading at $8.21 Tuesday.

Saks, which is known for its flagship store on Fifth Ave., has been rumored to be a takeover target several times. Cerberus and Permira have been mentioned as bidders for the retailer.

Nearly nine months ago, Saks removed a “poison pill” aimed at averting a potential hostile takeover by Mexican billionaire Carlos Slim. Slim has rapidly raised his stake as Saks shares fell below $3 in November 2008 during the global financial crisis. Slim now holds a 15.9 percent stake in Saks, making him its largest shareholder, our companeros at Reuters reported recently.

Now this doesn’t mean that Saks won’t be bought out. Just that the current rumors are probably wrong.