Abercrombie & Fitch Co. (NYSE:ANF) stock was up on Wednesday following news that the company may be preparing for a takeover.
Unnamed sources claim that Abercrombie & Fitch Co. has hired investment bank Perella Weinberg Partners. The bank will be handling incoming takeover requests for the teen clothing retailer. Both ANF and the investment bank have refused to comment on the matter.
Abercrombie & Fitch Co.’s decision to hire an investment bank to handle takeover offers come as the company’s struggles to remain relevant. Performance has been down and its stock is at a 17-year low. The decrease in mall traffic has also been hurting the brand as teens turn to online shopping.
The unnamed sources that say Abercrombie & Fitch Co. is preparing for takeover offers say there is no guarantee that a transaction will take place. However, low stock price does make the company a target for a possible acquisition, reports Reuters.
Abercrombie & Fitch Co. hiring an investment bank to handle takeover offers comes as mall retailers struggle to adjust for shifting shopping trends. This has resulted in several retailers filing for bankruptcy.
Retailers that have filed for bankruptcy recently include The Limited Stores, which has closed all 250 of its locations. General Wireless, the owner of RadioShack, has also filed for bankruptcy for the second time in two years. Payless ShoeSource also announced it had entered Chapter 11 bankruptcy protection in April.
Abercrombie & Fitch Co. is set to announce its earnings report for the first quarter of 2017 on May 25. Wall Street is expecting the company to report losses per share of 7 cents on revenue of $650.92 million.
ANF stock was up 8% as of Wednesday morning and is up 14% year-to-date.