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Kate Spade shares soar 23% after report that company is exploring a sale

Shares of specialty retailer Kate Spade surged 23 percent following a report that the company is exploring a sale. The stock had previously been halted twice in earlier trade due to volatility.

The company is working with a bank to contact possible buyers, Dow Jones reported, citing sources.

Kate Spade declined to comment to CNBC about the report.

The retailer has been under pressure from activist hedge fund and shareholder Caerus Investors, which encouraged it to pursuing selling itself.

With Wednesday's gains, Kate Spade shares are slightly higher on the year, gaining about 0.5 percent.

Read the full report about Kate Spade's exploration of a sale here.