CEO Erik Nordstrom and President Pete Nordstrom interested in take-private deal
Committee will determine if any potential bids are in best interest of company and owners
Department store chains facing weak sales due to inflation and elevated borrowing costs
Nordstrom brothers considering going private again
Nordstrom family collectively owns about 30% of company's shares as of March 2024
Retailer had market capitalization of approximately $3.06 billion as of LSEG data
Special committee formed to evaluate proposals
Nordstrom, the 123-year-old department store chain, is once again considering going private. The company's CEO Erik Nordstrom and President Pete Nordstrom have expressed their interest in pursuing a take-private deal for the retailer and have initiated the process by forming a special committee of independent directors to evaluate proposals from both the founding family and outside parties. The committee will determine if any potential bids are in the best interest of the company and its owners.
The Nordstrom family collectively owns about 30% of the company's outstanding shares as of March 2024, with CEO Erik Nordstrom holding a 7.45% stake. The retailer had a market capitalization of approximately $3.06 billion as of LSEG data.
The move comes at a time when department store chains across the U.S. are grappling with weak sales due to inflation and elevated borrowing costs, leading customers to reconsider their discretionary spending.
In 2017, Nordstrom announced that the founding family was exploring possibilities of going private through the acquisition of all outstanding shares of the company. However, they were unable to agree on an acceptable price and ended discussions with the family due to difficulties in arranging for debt financing.
Rival Macy's has also received offers from its investors Arkhouse Management and Brigade Capital to be taken private.
The committee will carefully evaluate any proposals from the Nordstrom brothers and other parties, keeping in mind that there is no assurance a deal will happen or be approved. The company does not intend to disclose further developments regarding this matter unless and until it deems it necessary.
Nordstrom CEO Erik Nordstrom and President Pete Nordstrom have expressed interest in taking the company private.
The board of directors has formed a special committee to evaluate proposals from the executives and other parties.
There is no certainty that any proposed transaction will be completed.
In the latest earnings report, Nordstrom’s premium banner saw a net sales dip of 3% year over year, while its off-priced banner Nordstrom Rack saw net sales rise by 14.6%.
CEO Erik Nordstrom plans to focus on digital-led growth for the Nordstrom banner, with the launch of a digital marketplace on Nordstrom.com starting in April.
Accuracy
][Erik and Pete Nordstrom] have expressed interest in taking the company private.[/
The Nordstrom family collectively owns about 30% of the company's outstanding shares as of March 2024.
CEO Erik Nordstrom and President Pete Nordstrom initiated the move
Founding family collectively owns about 30% of the company’s outstanding shares as of March 2024
Company had a market capitalization of about $3.06 billion as of LSEG data
Accuracy
][Erik and Pete Nordstrom] have expressed interest in taking the company private.[/
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The article contains an appeal to authority fallacy when it states 'In a filing on Thursday, the company said that CEO Nordstrom, who has a 7.45% stake in the retailer, might seek a debt or equity financing to consummate one or more transactions.' This statement implies that because the CEO owns a significant stake in the company, he is more likely to pursue taking it private. However, ownership of stock does not necessarily mean that the individual has expertise in financial matters related to taking a company private.
In a filing on Thursday, the company said that CEO Nordstrom, who has a 7.45% stake in the retailer, might seek a debt or equity financing to consummate one or more transactions.
