Nordstrom Founders Propose $23 Per Share Buyout to Take Company Private

Nordstrom’s founding family has proposed taking the department store chain private with an offer of $23 per share, valuing the company at approximately $3.76 billion.

The bid, disclosed in a filing on Wednesday, involves a partnership with Mexican retailer El Puerto de Liverpool.

The offer represents a modest 0.8% premium over Nordstrom’s closing share price of $22.82 on Tuesday. Since news of the family’s interest in a buyout emerged in March, Nordstrom’s shares have increased by 35%.

The proposed deal includes contributions from CEO Erik Nordstrom and President Peter Nordstrom, along with Liverpool. The financing plan consists of rollover equity, cash from the Nordstrom family and Liverpool, and $250 million in new bank financing.

As of September 4, the Nordstrom family held about 33.4% of the company’s shares, totaling roughly 54.6 million shares, while Liverpool owned nearly 10%, or 15.8 million shares.

In response to the bid, Nordstrom has formed a special committee of independent directors to evaluate the proposal. The company has also engaged financial and legal advisors to ensure the decision aligns with the interests of all shareholders.

The bid marks a new attempt to take the company private, following a previous rejection of an $8.4 billion offer in 2018 due to disagreements over valuation.

Nordstrom, founded in 1901 by John Nordstrom, has recently experienced stronger sales compared to competitors like Macy’s and Kohl’s, attributed to its focus on trendier merchandise.

The company’s stock has shown significant growth this year, increasing 23.7% year-to-date, surpassing the S&P 500’s 15.9% rise. Current shareholders are not required to take immediate action regarding the proposal.

With input from Reuters, CNBC and MarketWatch.