(Bloomberg) -- Kate Spade & Co., which put itself up for sale earlier this year, sank the most in eight months on concern that takeover talks are dragging on and may result in a lower price.
The handbag maker will require a few more weeks to negotiate the sale, Reuters said on Monday, citing unidentified people familiar with the situation. Kate Spade received an offer last week from Coach Inc., and Michael Kors Holdings Ltd. also is interested in a possible deal, the news service reported.
If a sale is successfully negotiated, the price would likely come in below Kate Spade's current $2.9 billion valuation, Reuters said. And it's possible that the talks won't result in a deal at all, according to the report.
Representatives for Kate Spade and Coach declined to comment, citing policies against discussing rumors and speculation. Michael Kors Holdings also declined to comment.
The shares fell as much as 16 percent to $19.17 in New York Tuesday, the biggest intraday slide since August. They had been up 22 percent this year through Monday's close, fueled by the takeover speculation.
The company said in February that it was exploring strategic alternatives, with Perella Weinberg Partners acting as financial adviser. Kate Spade investor Caerus Investors had pushed the fashion house to put itself up for sale. The investment firm said that while the company is generating solid growth, it needs better management to help boost its profit margins.
To contact the reporters on this story: Nick Turner in New York at nturner7@bloomberg.net, Stephanie Wong in New York at swong139@bloomberg.net.
To contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net, Lisa Wolfson
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