Daniel Kretinsky, the Czech billionaire who has a large stake in European retailers Casino and Metro, has taken a strategic stake of 5 % of the shares of American department store chain Macy’s.
The right time to invest
These are high times for Kretinsky, the wealthy investor with a penchant for ailing retailers. Only just recovered from Covid-19 himself, in April he already announced to be investing again “as we simply believe that the current market is undervaluing certain very interesting and important companies”.
His first major feat during this crisis: the Czech, who also owns a large part of two important European retailers, takes a 5 % stake in Macy’s. The transaction makes him one of the five largest shareholders in America’s premier department store group.
Moderate approach
Kretinsky calls the participation a “strategic investment”: he also wants to reform the struggling company and aims to have constructive discussions with management and the board of directors. After all, the investment comes after Macy’s share price plummeted once again, having lost almost 70 % of its valuation this year.
The chain’s future has been looking increasingly uncertain since the coronavirus outbreak forced the company to close its stores and lay off the majority of its employees. The chain is now looking for additional sources of funding and is postponing publication of its quarterly results.
During the current crisis, new shareholder Kretinsky is already arguing for a moderate approach: “Those who will not react enough will lose all or a lot, but those who will overreact will lose as well, potentially a lot.”
