US-based holding company Franchise Group has agreed to a three-week exclusive talk period concerning its acquisition of department store chain Kohl’s.

The company is offering $60.00 to a share in cash for Kohl’s, which would value the retailer at nearly $8bn.

The exclusivity period will allow Franchise Group and its funding partners to complete due diligence and financing arrangements, as well as negotiate binding documentation.

In a statement, Franchise Group said: “If Franchise Group and Kohl’s enter into a definitive agreement, Franchise Group intends to contribute approximately $1bn of capital to the transaction, all of which is expected to be funded through a corresponding increase in the size of its secured debt facilities.

“A majority of the financing for the transaction is anticipated to be provided on the basis of the real estate assets of Kohl’s Corporation.

“Other than the increased secured debt facilities of Franchise Group, none of the financing for the transaction is expected to be recourse to Franchise Group.”

Kohl’s said that the deal is conditional upon board approval and there is no assurance that the ongoing discussions would result in finalising the deal.

Both companies declined to provide additional comments until they reach a formal agreement or terminate the discussion.

In addition to Franchise Group, Reuters has reported that several other bidders have recently submitted competing offers for Kohl’s .

These include private equity firm Sycamore Partners and JC Penney investors Simon Property Group and Brookfield Asset Management.

Earlier this year, Kohl’s was encouraged by investors Macellum Advisors and Engine Capital to sell itself.

The retailer said that its Board of Directors remains focused on maximising value for all the company’s shareholders.

Last month, the retailer reported its revenue for the first quarter of the fiscal year 2022 (FY22) had dropped by 4.4% to $3.71bn from a year earlier.