Macy's to Issue $500M of Notes in Private Offering

Macy’s will issue $500 million of notes in a private offering and also has begun to buy up to $500 million of notes and debentures.
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Macy’s  (M) - Get Report shares rose Tuesday, after the department store chain said it would issue $500 million in senior notes due 2029 in a private offering.

The notes will be senior unsecured obligations and will be unconditionally guaranteed.

Macy’s plans to use the proceeds, together with cash on hand, to fund and pay the costs of the debt offering and of a tender offer. It said it would use any remaining proceeds for general purposes, including repaying debt outstanding.

Under the tender offer, Macy’s has begun to purchase as much as $500 million of notes and debentures. 

Macy’s recently traded at $15.47, up 1%. The Cincinnati retailing icon's stock is up 36% in 2021 through the close of Monday trading. It has lost almost two-thirds of its market value over the past five years amid the decline in brick-and-mortar retail and the rise of e-commerce.

In other Macy’s news, John Harper, chief operations officer, will depart the company effective Aug. 1. At that point the post will be eliminated.

Macy’s also said that Marla Beck, co-founder and chief executive of the beauty-products and services subsidiary, will leave the company this summer.

Parent Macy's has begun a search for a new CEO at the chain. That executive will report to Tony Spring, chairman and CEO of the Bloomingdale's unit.

Macy's last week posted stronger-than-expected fourth-quarter earnings and said current-year sales could top $20 billion in what it sees as a 'recovery and rebuilding' year.

But it also said mall-based sales will continue to face headwinds linked to consumer-spending changes and COVID restrictions. It added that it planned to spend around $650 million as part of its turnaround plans.

TheStreet.com Founder Jim Cramer said after last week’s earnings report that he likes the stock.