By Praveen Paramasivam
(Reuters) -Canadian department store chain Hudson (NYSE:HUD)'s Bay Co is bidding for American peer Kohl's Corp (NYSE:KSS), a source familiar with the matter told Reuters.
Shares of the U.S. retailer, which is facing pressure from activist investors to sell itself, rose as much as 17% to $62.98, valuing the company at about $8.76 billion.
The Wall Street Journal on Wednesday reported, citing people familiar with the matter, that private equity firm Sycamore Partners and Hudson's Bay were planning bids in the high $60s per share.
Kohl's has asked suitors to submit offers by Wednesday, the report said. It added that the company has indicated it believed it was worth over $70 per share, citing one of the people.
Sycamore Partners declined to comment.
Kohl's had previously rejected two buyout offers, valuing it at between $64 and $65 per share, from Sycamore and Starboard Value-backed Acacia Research. But Kohl's said this month that investment bank Goldman Sachs (NYSE:GS) spent January, February and March talking to more than 20 parties, adding it had provided a few of them access to more financial data.
Axios was the first to report that Hudson's Bay was considering a bid for Kohl's.
"The board will measure potential bids against a compelling standalone plan," Kohl's said in an emailed response on Wednesday, adding the engagement with potential bidders was "robust and ongoing".
Saks Fifth Avenue-parent Hudson's Bay Co is owned by HBC.