Nordstrom’s founding family is looking to take the Nordstrom department store operator private six years after a similar attempt failed, people familiar with the matter said Tuesday.
Deliberations on the deal come as Nordstrom and other U.S. retailers grapple with the effects of inflation and high interest rates to curb consumer discretionary spending.
Another department store operator, Macy’s, is also a takeover target.
Nordstrom has asked investment banks Morgan Stanley and Centerview Partners to reach out to private equity firms to gauge interest in a potential deal, people familiar with the matter said.
It is not certain that a deal will be reached, the sources added, asking not to be named because the matter is confidential.
Nordstrom and Morgan Stanley declined to comment. A Centerview spokesperson did not respond to a request for comment.
Nordstrom shares rose 11% to $19 on Tuesday’s news, giving the company a market capitalization of $3.2 billion.
The company also has approximately $2.3 billion in debt, net of cash.
Nordstrom has more than 350 stores and an e-commerce operation.
CEO Eric Nordstrom and other members of the Nordstrom family jointly own about 30% of the Seattle-based company.
Nordstrom created a special board committee in 2017 to consider the family’s take-private proposal and explored deals with several private equity firms, including Leonard Green.
In 2018, a special committee rejected the $8.4 billion proposal as inadequate.
Nordstrom earlier this month predicted full-year results would be significantly lower than Wall Street expectations as price-conscious consumers weighed on profits.
One bright spot is discount chain Nordstrom Rack, which is adding more stores.
Investment firms Arkhouse Management and Brigade Capital are seeking to take Macy’s private for $6.6 billion, and are also challenging the company’s board of directors.
Macy’s has so far rejected the companies’ offers, but the two sides continue to negotiate.
Ryan Cohen, the billionaire investor and CEO of video game retailer GameStop, acquired a 4.2% stake in Nordstrom last year but did not press ahead with plans to challenge the board. revealed that.
