Kate Spade & Co trying to find buyer
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Handbag and accessories maker and retailer Kate Spade & Co, under pressure from activist investor Barry Rosenstein, is working with a bank to sound out possible buyers.
Quoting insiders, the Wall Street Journal says potential buyers contacted include retailers, with the process at an early stage.
Rosenstein’s Jana Partners already has a minor stake in the company.
Kate Spade has a market value of about $1.86 billion, but sales have dropped as the demand for handbags has weakened over the past year in the US, with people shopping less often at department stores and tourists spending less because of a strong dollar.
Known for its quirky and colourful satchels and totes, Kate Spade was expecting dampened earnings over the holiday shopping quarter because of pricing competition.
Questions & Answers
Q.Why is Kate Spade & Co looking for a buyer?
Why is Kate Spade & Co looking for a buyer?
Activist investor Barry Rosenstein is pressuring the company. Sales have also fallen due to decreased demand for handbags in the US, less department store shopping, and reduced tourist spending because of a strong dollar.
Q.What is Kate Spade & Co's current market valuation?
What is Kate Spade & Co's current market valuation?
The company currently has a market value of approximately $1.86 billion. This figure comes amidst a period where sales have been dropping, particularly in the US market.
Q.What factors are affecting Kate Spade's recent sales performance?
What factors are affecting Kate Spade's recent sales performance?
Demand for handbags has weakened in the US, people are shopping less at department stores, and tourists are spending less due to a strong dollar. Pricing competition is also dampening expected holiday earnings.