Coach Declines Comment on Buyout Buzz

By Matt Egan Retail FOXBusiness


Shares of Coach (COH) jumped as much as 5% Wednesday morning on buyout buzz, but the luxury leather goods maker declined to comment on “speculation or rumors.”

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Earlier on Wednesday traders were chattering about a report from mergermarket that said the New York-based company is rumored to be exploring a sale.

Citing industry bankers, mergermarket reported that logical strategic buyers include French luxury goods makers LVMH and PPR as well as department store Macy's (M).

Private-equity firms may also express interest in Coach, though they would likely have to team up to take over a company of this size, the report said. Coach's market cap climbed above $13.5 billion on Wednesday.

“We do not comment on speculation or rumors, particularly unsubstantiated ones,” a Coach spokesperson said.

Coach also unveiled a new hire on Wednesday, tapping former Nike (NKE) global creative director Zach Augustine to oversee a renovation of its stores.

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Despite the denial, shares of Coach still hit an intraday high of $49.00 on Wednesday and were recently trading up 3.47% to $48.11. The rally trims Coach's 2013 slump to 13%.

The buyout buzz comes as the M&A world has gained momentum in recent weeks, with the announcements of high-profile buyouts of PC maker Dell (DELL) and food giant H.J. Heinz (HNZ).

Earlier in February Coach announced that longtime CEO Lew Frankfort will step down in January, handing the keys to the $13 billion company to Victor Luis.

Coach’s shares have plummeted about 40% amid concerns about future growth prospects since hitting nearly $80 in late March 2012

Late last month the maker of luxury handbags and other items disclosed a weaker-than-expected 1.5% rise in fiscal second-quarter earnings as North American same-store sales slumped 2%.

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