Shares of Kate Spade (KATE) are higher in early trading following a report from Bloomberg this weekend that said the company is attracting takeover interest from peers Coach (COH) and Michael Kors (KORS), as well as foreign luxury brands.

WHAT'S NEW: Kate Spade is attracting takeover interest from Coach and Michael Kors as it pursues a sale, Bloomberg reported after the market close on Friday, citing people familiar with the matter. Coach and Michael Kors are currently speaking with their boards about potentially moving forward with a bid. according to the report. Foreign luxury brands are also eyeing Kate Spade, one of the people said. 

WHAT'S NOTABLE: Bloomberg said in late December that Kate Spade was planning to kick off a formal auction process in January, with a person familiar with the matter noting that the retailer had drawn interest from six potential bidders. In November, activist investor Caerus reported a stake in Kate Spade and called for exploration of a sale, saying it was concerned about the company's underperformance. At the time, The Wall Street Journal said that Kate Spade could draw "a number of potential buyers," adding that Coach had "long been considered a good home" for the company. Kate Spade said in November that its quarterly comparable sales were impacted by increasing tourism headwinds in its brick and mortar business and called comps and gross margins "somewhat disappointing." The company, which noted that industry-wide challenges have persisted into the second half of the year, said it continues to feel the impact of the price-sensitive customer in its full priced and off-price channels, particularly in its outlets, and said the environment remains "heavily promotional."

PRICE ACTION: Kate Spade is up nearly 5% to $18.63 in morning trading. Meanwhile, Coach is flat at $35.31 and Michael Kors is up about 1% to $42.82.