Introduction
Most founders dream of building a business valuable enough that someone wants to buy it. Far fewer think about the pressure that comes with deciding whether to accept the offer or walk away.
In 2022, Kohl’s found itself facing exactly that decision.
Several buyers expressed interest in acquiring the retailer, with one proposal valuing the company at roughly $9 billion, or about $64 per share. Instead of accepting the offer, Kohl’s adopted a poison pill, continued exploring alternatives, and argued that remaining independent could create more value for shareholders. The company wasn’t rejecting a sale because it refused to listen. It believed there was a better future ahead.
Several years later, that decision looks much more complicated.
Kohl’s continues working to stabilize the business after years of declining sales, leadership changes, and increased competition. Although recent results suggest the company may finally be slowing its decline, investors still compare today’s performance with the opportunity management chose to reject.
For business owners, the lesson extends far beyond one retailer. Every founder eventually faces decisions about whether to maintain control, seek outside investment, or sell the business altogether. Kohl’s shows that saying no creates a responsibility to deliver something even better.
Keeping Control Only Creates Value If You Use The Time Well
Businesses often assume that keeping control automatically protects the future. In reality, maintaining control only creates value if leadership uses the additional time to improve the company. Delaying a major decision accomplishes very little unless that delay leads to stronger operations, higher profits, or a better outcome.
Kohl’s adopted a shareholder rights plan, commonly known as a poison pill, after takeover interest intensified in early 2022. The strategy prevented outside investors from easily acquiring more than 10 percent of the company’s shares without board approval by allowing existing shareholders to purchase discounted shares if that threshold was crossed. The goal was not necessarily to stop every acquisition forever. It was to give the board leverage and time to negotiate from a stronger position.
Importantly, Kohl’s did not end discussions after adopting the poison pill. The company hired financial advisers, contacted additional buyers, and ultimately engaged with more than 25 interested parties while reviewing strategic alternatives. The poison pill was never the strategy. It was simply a tool that created time.
The real question became whether management could use that time to produce a better outcome than shareholders already had on the table.
Together, these examples reinforce an important principle. Buying yourself more time only creates value if you use that time to build a stronger business. Otherwise, delaying a difficult decision simply postpones it. That lesson connects directly back to the introduction because keeping control is only worthwhile when it produces results that justify rejecting another opportunity.
But deciding to remain independent was only the first challenge. The next question was whether rejecting the offer had actually been the right financial decision.
The Highest Offer Isn’t Always The Best Deal
A large purchase price often attracts the most attention, but experienced business owners know that headline numbers rarely tell the entire story. Financing, payment structure, due diligence, earn outs, closing conditions, and the buyer’s ability to complete the transaction all determine whether an offer becomes real money.
Although the company rejected earlier proposals worth approximately $64 per share, it continued negotiating with other interested buyers. Eventually, Franchise Group emerged as the leading bidder, and the companies entered exclusive negotiations. However, as financing conditions deteriorated and economic uncertainty increased, the proposed transaction became much more difficult to complete. Ultimately, the deal collapsed because the financing environment had changed dramatically.
That outcome demonstrates why experienced sellers rarely evaluate an acquisition based only on the purchase price. A higher number means very little if financing falls apart before closing.
Advisers consistently recommend comparing multiple buyers, understanding how each deal is structured, and confirming that prospective buyers actually have the financial resources necessary to complete the acquisition. Negotiation should focus on certainty as much as price.
Together, these examples show that business owners should evaluate offers based on their complete value rather than the headline number alone. A realistic offer backed by strong financing may ultimately create more value than a larger proposal filled with uncertainty. That idea naturally leads to the final lesson because once leadership rejects a major offer, expectations immediately become much higher.
Once a company decides it is worth more than today’s offer, investors expect tomorrow’s performance to prove it.
Rejecting An Offer Raises The Standard For Future Performance
Every major business decision creates new expectations. When leaders reject an acquisition because they believe the company is worth more, shareholders naturally expect stronger sales, higher profits, and better long term performance. Independence becomes something that must be earned rather than simply preserved. Kohl’s experienced exactly that pressure.
Over the following years, the company continued facing declining sales, increased competition, and operational challenges. It closed underperforming stores while searching for ways to stabilize the business. By 2026, however, there were also signs that the turnaround might finally be gaining traction. Comparable sales declines moderated, digital sales improved, inventories became healthier, and credit analysts began describing the company’s outlook as stabilizing rather than deteriorating. Those improvements are important because they prevent the story from becoming overly simplistic.
Looking only at today’s share price does not automatically prove the board made the wrong decision in 2022. Retail conditions changed significantly, financing markets tightened, consumer spending shifted, and the business itself evolved. Judging every decision only by the final stock price ignores those broader realities.
Rejecting a major opportunity immediately raises the burden of proof.
Once you tell investors, employees, or partners that a better future exists, every decision afterward is measured against that promise.
Together, these examples reinforce one final lesson. Independence is not automatically valuable. It becomes valuable only when leadership uses it to build something stronger than the opportunity it chose to reject. That brings the story back to the opening statement because saying no to a major offer creates an obligation to deliver a better outcome.
Main Takeaway
Keeping control is not the same as creating value. Kohl’s did not reject takeover offers simply to avoid being acquired. Management believed remaining independent would ultimately produce greater long term returns for shareholders. Whether that decision proves successful will continue to be debated, but the broader lesson is already clear.
Every founder eventually faces moments where control, outside investment, or an acquisition all become possible paths forward.
It depends on whether your plan for the future is genuinely stronger than the opportunity sitting in front of you.
Looking Ahead
Personally, I think many founders instinctively value independence because they built the business themselves. That instinct is understandable, but control should never become the goal by itself.
The businesses that make the best long term decisions will be the ones that honestly compare every opportunity against a realistic plan for future growth. Sometimes that means continuing independently. Other times it means accepting outside help or even selling the company. What matters most is choosing the path that creates the greatest value, not simply the one that allows you to remain in charge
