Report: Nordstrom Family Reviving Effort to Take Company Private
The Nordstrom family is reviving an effort to take their namesake retail company private, according to unnamed sources cited by Reuters on Friday. The family had suspended its effort in October, but said it intended to resume exploration of a take-private offer after the holidays. Reuters reported that the family met with investment bankers last week in preparation for an offer to buy the outstanding shares of the company, and is hoping to submit an offer as early as next month once the banks get approval from their credit committees to provide the financing, the sources said. Details of the offer could not be learned. Analysts have speculated that the Nordstrom family would like to take the business private so it has more latitude to transform away from the quarter-by-quarter scrutiny of Wall Street investors.
Total Retail's Take: Ironically, news of Nordstom going private has been good for Wall Street investors. After the news came out on Friday, Nordstrom stock rose 6.5 percent, giving the company a market value of more than $8.9 billion. That’s up from the $7.5 billion it was worth last June when the Nordstrom family group — Co-Presidents Blake Nordstrom, Peter Nordstrom and Erik Nordstrom; President of Stores James Nordstrom; Chairman Emeritus Bruce Nordstrom; and Anne Gittinger, granddaughter of the co-founder John W. Nordstrom — first disclosed its interest in taking the company private. For now this is all speculation. We won't know for sure what Nordstrom's intentions are until it announces them publicly. We will be watching Nordstrom closely on March 1, when it's scheduled to report financial results for the fourth quarter. Its performance during the critical holiday sales period could influence the go-private effort. A strong quarter could convince lenders and private equity investors to back the family in a buyout bid, for example, while weaker sales and profits could throw cold water on a deal.