SEATTLE—Nordstrom Inc.'s board of directors confirmed Monday that talks to take the high-end retailer private have been suspended. The decision came from members of the Nordstrom family, and talks may be resumed after the holiday season.
GlobeSt.com reported in June that the Nordstrom family group, which owns 31.2% of the retailer, was considering the acquisition of all remaining shares of the company's stock. Last month, published reports said that the family was coming close to forging a partnership with Leonard Green & Partners.
CNBC reported in September that the private equity firm would take a minority stake of about $1 billion and help arrange up to $7 billion in financing. The debt as well as Leonard Green's stake reportedly would have been senior to the family group's equity.
However, the New York Post quoted a source who gave the partnership a 50/50 chance of taking the 116-year-old retailer private. “It's a really tough deal,” the source told the Post.
The newspaper also quoted a source who said the amount of financing lenders would be willing to provide would determine whether a deal came to fruition. “Costs and terms associated with the debt will be more important than choosing an equity partner,” according to the Post's source.
Although Nordstrom's most recent quarterly results, reported in August, met expectations, the company has been challenged by a general slowdown in the department-store sector. Last month it rolled out Nordstrom Local, a brick-and-mortar concept that carries no merchandise but instead provides services.
The Nordstrom family group includes Blake W. Nordstrom, Peter E. Nordstrom and Erik B. Nordstrom, the company's co-presidents; president of stores James F. Nordstrom; chairman emeritus Bruce A. Nordstrom; and Anne E. Gittinger. A special committee of the company's board, formed this past June to act on the company's behalf, is being advised by Centerview Partners LLC as financial advisor and Sidley Austin LLP as legal counsel.
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Paul Bubny
Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.
