Members of the Nordstrom family, in collaboration with Mexican retailer El Puerto de Liverpool, have proposed to privatize Nordstrom for $3.76 billion in cash. This follows an earlier expression of interest. In a recent letter to the board, CEO Erik Nordstrom highlighted that the family, holding 33.4% of shares, would pay $23 per share, consistent with current trading prices.
El Puerto de Liverpool owns approximately 9.6% of Nordstrom and is instrumental in the bid. The price is 35% more than shares were trading at on March 18, when whispers about the potential deal began. Neil Saunders of GlobalData gave context: "That the Nordstrom family have made an offer to buy the department store chain comes as no surprise. What is interesting is the $23 a share value which is pretty much the current price of the stock. The lack of any real premium would, under normal circumstances, make the offer unattractive. However, as a family-run firm the dynamics are slightly different."
He said whether the transaction would be in the best interests of the company and its investors is for a special committee of the board of directors that formed in April to determine. Nordstrom's recent performance is a mixed bag. While sales rose by 3.4% in Q2, net income declined nearly 11%. Growth in the Nordstrom Rack division was notable, whereas traditional stores faced challenges. (This story was generated by Newser's AI chatbot. Source: the AP)
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