(Bloomberg) — Kohl’s Corp. rose after saying it’s in exclusive talks about a potential $8 billion takeover deal from Franchise Group Inc., the owner of Pet Supplies Plus and The Vitamin Shoppe.

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The companies said in separate statements Monday that they entered a three-week exclusive negotiation period to discuss Franchise Group’s offer to buy Kohl’s for $60 a share. Shares of the department-store chain rose 7.8% to $45.39 at 9:33 a.m. in New York.

A marriage of the two publicly traded companies would be an intriguing match. As its name indicates, Franchise Group operates franchised businesses. Kohl’s would also be a new foray into apparel, though it does have brands that sell furniture, mattresses and appliances. One of those brands, American Freight, combined with Sears Outlet in 2020.

The exclusivity period would give Franchise Group time to complete due diligence and financing arrangements. Delaware, Ohio-based Franchise Group intends to contribute about $1 billion in capital to a potential transaction, which will be funded through a corresponding increase in its secured debt facilities. Most of the financing is expected to be provided on the basis of Kohl’s real estate assets.

It’s been a tumultuous year for Kohl’s shareholders. The retailer rejected takeover offers as too low earlier this year and then authorized financial adviser Goldman Sachs Group Inc. to engage with select bidders. In May, the company fended off an attempt by activist investor Macellum Capital Management to overhaul the board, which some analysts said lowered the chances of a deal.

Both Sycamore Partners and a suitor backed by hedge fund Starboard Value LP had engaged with Kohl’s about a potential deal amid activist investor pressure to sell, Bloomberg News reported. While it was unclear how much Sycamore was willing to pay for Kohl’s, Acacia Research Corp., the Starboard-backed suitor, had offered $64 a share, or about $9 billion.

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Shares of the Menomonee Falls, Wisconsin-based retailer had slumped 15% this year through Monday and haven’t closed above $64 since May 2021. Franchise Group, meanwhile, had already lost 29% this year, and its stock was down 1.2% on Tuesday morning. Franchise Group, with a market value of $1.49 billion as of Monday’s close, would be acquiring a much bigger company if the transaction proceeds.

(Updates shares in second, seventh paragraphs.)

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