Kohls (KSS)($45.59) has hung a for-sale sign on its doors. News broke late on Monday that it had entered into a three-week exclusive negotiation period for a potential sale with Franchise Group (FRG)($38.77), a holding company which owns The Vitamin Shoppe and other retail brands. Franchise Group has proposed to buy Kohl's for $60 a share. On Monday, Kohl's stock closed at $42.12 and rallied 8.24% during Tuesday's trading hours. With more than 1,100 US stores and around $19 billion in annual sales, Kohl's is the largest department store chain in the United States.

The news is seen as a step forward, especially after more than a year of activist approaches, breakup proposals and rebuffed board shake-up plans. On its first-quarter earnings call on May 5, Franchise Group reported 82% revenue growth to $1.1 billion and reaffirmed its full-year sales target of $4.4 billion. By comparison, Kohl's Q1 sales, reported on May 19, fell 5% to $3.7 billion. The latest bid also comes at a challenging time for the legacy big box retail store format, whose ongoing digital transformation before and during the pandemic has been further burdened with recent supply chain and inventory issues.