Saks (SKS), which was up until recently one of the world’s premier brands for high-end shoppers, has voted itself a "poison pill". The purpose of this may be to block Mexican billionaire Carlos Slim from taking the company over.
According to The Wall Street Journal, "Just days after Mexican billionaire Carlos Slim Helu raised his stake in Saks Inc. to nearly 18%, the beleaguered luxury retailer has adopted a shareholder rights plan intended to thwart a potential takeover."
The board at Saks should let him have the company.
Saks now trades at $4.33, down from a 52-week high of $22.19.
The quarter that the firm closed was remarkably poor. Saks recorded a net loss of $42.8 million, or $.31 per share, for the third quarter ended November 1, 2008. Last year Saks had net income of $21.6 million, or $.14 per share. Revenue fell from $796 million last year to $698 in the most recent period.
Each month of the period, things got worse. Comparable store sales declined 5.9%, 10.9%, and 16.6% in August, September, and October, respectively, culminating in an 11.5% decline for the quarter. Saks said that the fourth quarter would be hard and that gross margins would face pressure.
Saks has long-term debt of $480 million. It prospects are dim.
If Slim will buyout public shareholders for $7 or $8 they should sell with glee.
Douglas A. McIntyre
Cash Back Credit Cards Have Never Been This Good
Credit card companies are at war, handing out free rewards and benefits to win the best customers. A good cash back card can be worth thousands of dollars a year in free money, not to mention other perks like travel, insurance, and access to fancy lounges. See our top picks for the best credit cards today. You won’t want to miss some of these offers.
Flywheel Publishing has partnered with CardRatings for our coverage of credit card products. Flywheel Publishing and CardRatings may receive a commission from card issuers.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
