Century-old department store Nordstrom has agreed to be acquired and taken private by members of the Nordstrom family and a Mexican retail group in a $6.25 billion deal that comes as the department store faces pressure from discount chains and other competition. Are facing.
Nordstrom shareholders will receive $24.25 in cash for each share of Nordstrom common stock, or approximately $4 billion in total, representing a 42% premium over the company's stock as of March 18, when the potential transaction was reported by the media. . Nordstrom will also take on more than $2 billion in debt.
As a private business, Nordstroms may have more leeway to revive the department store chain, which, like others, is looking to revive years of weak sales. Other publicly traded retailers, including Macy's and Kohl's, have faced pressure from major investors to provide larger returns to investors, while also trying to fend off competition from low-cost rivals such as Walmart and Amazon.com. Are trying.
“Although a change in ownership does not automatically solve all the problems of department store operations, it will allow the family and their supporters to take a long-term view of the business and make the necessary investments and transition away from short-term scrutiny of the public markets. ,” GlobalData analyst Neil Saunders noted in a Monday research note.
He further said, “The [Nordstrom] Like El Puerto de Liverpool, the family also has the talent and ability to bring about change. They will likely run the business as a retailer rather than some kind of financial play, which is, in our view, a very positive thing for the long-term health of the brand.”
Nordstrom shares fell 36 cents, or 1.5%, to $24.17 in late morning trading.
Offering Nordstrom Family, El Puerto de Liverpool
This offer announced on Monday is at the top Previous $23-per-share bid The Nordstrom family and the Mexican retail group, El Puerto de Liverpool, formed in September.
The board also plans to authorize a special dividend of up to 25 cents per share, which will be based on Nordstrom's cash immediately prior to the transaction and contingent upon the closing of the transaction.
The deal is expected to close in the first half of 2025, at which time the company's shares will not trade publicly.
Nordstrom's board of directors unanimously approved the proposed transaction, with Nordstrom family members Eric and Pete Nordstrom taking charge of the company – they recused themselves from that vote.
Following the closing of the transaction, the Nordstrom family will have a majority ownership stake in the company. Eric and Pete Nordstrom are fourth-generation leaders at the Seattle retailer, which was founded in 1901 as a shoe store. Eric is the company's chief executive and Peter is the president.
After opening 23 new stores so far this year, the company now operates a combined 381 Nordstrom and Nordstrom Rack stores in the US.