Macy's (M) stock traded up more than 20% for $20.85 in premarket trading in the early premarket trading in New York on Monday following the release of a report about buyout offer.

According to CNBC, Arkhouse Management and Brigade Capital Management have offered to buy Macy's Inc. for $5.8 billion. Sources said Arkhouse, a powerhouse focused on real estate investments, and Brigade Capital, an asset manager, were willing to make a higher offer based on due diligence. The group has paid a premium for the department store, which has struggled to keep up with online competition. The acquisition values ​​the retailer at $21 per share, compared with the company's previous closing price of just over $17 per share.

Macy's sales have profoundly slumped over the past year as traditional retailers struggle to keep up with online competition. Macy's has made several efforts to lure customers back to its legendary brick-and-mortar chains, but as holiday shopping season approached with very little progress, the company has been forced to ramp up with alternative opportunities to stay afloat. In October, the company announced the opening of 30 new stores in malls as it seeks to break away from traditional malls. Despite its turnaround efforts, Macy's sales fell sharply, down 7% YoY.