American luxury department store chain Nordstrom will be taken private in a $6.25 billion deal, according to a company announcement.
On Dec. 23, Seattle-based Nordstrom announced it signed a definitive agreement with members of the Nordstrom family and Mexican company El Puerto de Liverpool, S.A.B. de C.V. to purchase all of the outstanding common shares of Nordstrom that the Nordstrom family and Liverpool do not already own. Nordstrom first went public in 1971.
Representatives of Nordstrom did not immediately respond to a request for comment from The Epoch Times.
According to a release from Nordstrom, shareholders will receive $24.45 in cash for each share of Nordstrom stock they hold. That is about a 42 percent premium on the stock price when the rumors of a transaction were first published in March. Moreover, Nordstrom’s board will authorize a special dividend of as much as 25 cents per share.
Nordstrom, founded in 1901, is a chain of more than 350 stores operating as Nordstrom, Nordstrom Local, and Nordstrom Rack.
El Puerto de Liverpool is an omnichannel retailer with more than 310 stores in Mexico. It is also one of the country’s leading credit card issuers.
According to the release, the transaction should close in the first half of 2025 and is subject to regulatory approval. Additionally, two-thirds of the company’s common stockholders must approve the sale.
Following the transaction, 50.1 percent of Nordstrom will belong to the Nordstrom family, and 49.9 percent will belong to El Puerto de Liverpool.
According to Nordstrom’s most recent quarterly earnings release, Nordstrom Inc. reported net earnings—or profit—of $46 million for the three-month period ending on Nov. 2, 2024. That was a decline from $67 million reported in the same period the prior year.
However, according to the same disclosure filed with the Securities and Exchange Commission on Dec. 5, 2024, the company reported net earnings of $128 million through the first nine months of 2024. That was a significant increase from a $4 million loss it reported over the first nine months of 2023.
In its 2023 annual report, filed with the SEC on March 19, 2024, Nordstrom reported net earnings of $134 million, a decline from $245 million in 2022.
The transaction occurred as traditional department stores continue to lose ground to both lower-cost competitors like Walmart Stores Inc. and online retailers like Amazon.com Inc.
As of midday Monday, Nordstrom stock was trading for about $24 a share. The stock’s value rose by about 30 percent in 2024. However, it has fallen by more than 75 percent since it peaked at about $80 a share in the fourth quarter of 2014 and first quarter of 2015.