Breaking News
Investing Pro 0
Free Webinar - Crude Oil Trading 2023 | Thursday, February 9, 2023 | 01:00PM PST Enroll Now

Cowen Gives 40%-60% Chance Franchise Group's Kohl's Acquisition Goes Through

Stock Markets Jun 09, 2022 03:49PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. Cowen Gives 40%-60% Chance Franchise Group's Kohl's (KSS) Acquisition Goes Through
 
KSS
-4.08%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

By Sam Boughedda

Kohl's (NYSE:KSS) announced earlier this week that it is in exclusive talks with Franchise Group (NASDAQ:FRG), a retail holdings company, to be acquired at $60 per share.

In a note, Cowen analyst Oliver Chen said they believe a deal is more likely than not depending on risk factors. He assigned a 40% to 60% probability of the deal closing at $60.

However, Chen also assigned a 40% to 60% chance of the deal breaking and the stock trading at $36 per share.

"We think FRG has been diligent in securing financing due to comments made in its 1Q earnings call. We also believe cultural compatibility will be a factor, which FRG has considered over the past 3 acquisitions in FY21. Based on incoming sentiment and feedback, the key factors surrounding investor fears include FRG's ability to successfully close the deal and effectively initiate a sale leaseback on Kohl's real estate portfolio (or about ~$8bn per Cowen's est.)," said Chen.

The analyst acknowledged that the potential deal breaking price is a variable to consider.

Even so, he added that management at FRG successfully navigated 3 acquisitions in FY21 and further implemented a growing profitability strategy through synergies and franchising efforts across the portfolio.

"Kohl's fits well within FRG's core strategy as a $1bn annual FCF company that offers a broad selection of categories to a diverse set of core customers," said Chen.

Cowen Gives 40%-60% Chance Franchise Group's Kohl's Acquisition Goes Through
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email