Nordstrom CEO, President Aim to Take Company Private
Nordstrom’s CEO Erik Nordstrom and President Pete Nordstrom have told the retailer’s board that they’re interested in taking the company private.
As a result, the board has formed a special committee of independent and disinterested directors that will evaluate any proposals from those executives and from other parties, the company said in a Thursday (April 18) press release.
The CEO and president expressed their interest while the board was in the process of exploring possible avenues to enhance shareholder value, according to the release.
“The Board of Directors of Nordstrom, Inc. is committed to enhancing shareholder value and regularly evaluates a wide range of strategic, financial and operational alternatives as the Company continues to execute its strategic plan,” the company said in the release.
It added that there is no certainty that any proposed transaction will be completed, and that it doesn’t plan to disclose further developments on this matter unless appropriate or necessary, per the release.
It was reported in March that Nordstrom’s founding family was mounting another effort to take the retailer private and was in negotiations with banks on the deal.
They have attempted to do this before. In 2017, Nordstrom put together a special committee to consider a buyout deal and discussed the option with several private equity firms. However, in 2018, the committee rejected a bid as insufficient.
The Nordstrom founding family has expressed its desire to go private and retain control of the chain to allow the company to focus on long-term growth without the constant scrutiny of public markets.
In the company’s latest earnings report, the retailer said that its premium Nordstrom banner saw net sales dip 3% year over year, while its off-priced banner Nordstrom Rack saw net sales rise by 14.6%. Digital sales across these banners decreased 1.7%.
“We will focus our Nordstrom banner efforts on digital-led growth supported by our stores,” CEO Erik Nordstrom said March 5 during the company’s quarterly earnings call. “One thing we’re excited about is the launch of our digital marketplace on Nordstrom.com starting in April. … As we do this, we’re also creating a more personalized digital experience that makes it easy for our customers to navigate our growing assortment.”
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