Macy's, Inc. Terminates Discussions With Arkhouse and Brigade; Revised Proposal Lacks Certainty Of Financing, Remains Non-Actionable And Does Not Provide Compelling Value; Reiterates Board And Management's Commitment To Shareholder Value Creation And Confidence In "A Bold New Chapter" Strategy

Revised Proposal Lacks Certainty of Financing, Remains Non-Actionable and Does Not Provide Compelling Value

Reiterates Board and Management's Commitment to Shareholder Value Creation and Confidence in "A Bold New Chapter" Strategy

Macy's, Inc. (NYSE:M) today announced that, following months of engagement with Arkhouse Management Co. LP ("Arkhouse") and Brigade Capital Management, LP ("Brigade"), its Board of Directors (the "Board") has unanimously determined to terminate discussions with Arkhouse and Brigade that have failed to lead to an actionable proposal with certainty of financing at a compelling value. The Board intends for the management team to return its full focus to enhancing shareholder value through the execution of the Company's "A Bold New Chapter" strategy.

Proposal Lacks Certainty of Financing and Compelling Value

The Macy's, Inc. Board and management team have engaged in good faith with Arkhouse and Brigade for more than seven months since their initial outreach in December 2023 expressing interest in acquiring the Company.

• In March 2024, the Company entered into a confidentiality agreement with Arkhouse and Brigade to facilitate a due diligence process, given they had increased their proposal to $24.00 per share (from the initial $21.00 proposal) and indicated a willingness to increase this price further upon access to customary diligence, potentially to an amount that the Board could consider compelling.
• The Company has since expended hundreds of hours addressing Arkhouse and Brigade's extensive diligence requests, facilitating diligence meetings with multiple members of the Company's senior management as well as its financial and real estate advisors and providing thousands of documents with a level of detail that went well beyond what is customarily required to obtain financing for a public company acquisition, such as providing complete store-by-store P&L's and full-form leases for each Macy's, Bloomingdale's and Bluemercury location. The Company also permitted Arkhouse and Brigade to contact – and share confidential information with – over a dozen credible financing sources.
• In May 2024, the Company and Arkhouse and Brigade mutually agreed to a timetable for them to deliver a fully financed and actionable proposal to Macy's, Inc. The Company formally requested two items be delivered by June 25, 2024: 1) the best purchase price per share that Arkhouse and Brigade were prepared to pay to acquire the Company, and 2) fully negotiated commitment papers for all the debt and equity needed to finance the revised proposal, subject only to the negotiation of definitive documentation and customary confirmatory due diligence.
• On June 26, 2024, rather than delivering a definitive, fully financed and actionable proposal, Arkhouse and Brigade submitted a response they characterized as a "check in" letter expressing an interest in acquiring all of the outstanding shares of the Company for $24.80 per share in cash, which is within a range the Board had previously communicated to Arkhouse and Brigade was not compelling. Further, the financing papers that accompanied the "check in" letter were insufficient to give the Board confidence that a fully committed, financed and viable offer could be attained within any reasonable period of time – and necessitated bearing an unacceptable lack of certainty for the Company and its shareholders.