Another activist investor takes on Macy’s this time

Starboard Value Investors garnered a lot of PR recently, with its micro-critical look at the operations of Darden Restaurants before taking over the chain. Now its sights are set on Macy’s, in hopes to “unlock the asset value” of Macy’s real estate. Here’s my comment from a recent RetailWire discussion:

It’s arguable that Starboard drove the share price of Darden Restaurants higher by micromanaging issues like the breadsticks at Olive Garden. But it’s hard to make the same case that they can bring much value to the operation of Macy’s, widely viewed as an industry leader. Macy’s ought to be free to make its own decisions about the value of its real estate assets, instead of reacting to the whims of an “activist” investor.

The history of activists and retailers is not pretty, if William Ackman and Eddie Lampert can be used as examples. (Don’t forget Ackman’s push to “unlock” the real estate value of Target, before his misadventure at JCPenney.) Successful retailers are about much more than “unlocking assets,” and they really depend for their success upon good merchandising, branding, store operations and omnichannel strategies.

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