SEATTLE — Nordstrom Inc. (NYSE: JWN) has signed a definitive agreement with the Nordstrom family and Mexican omnichannel retailer El Puerto de Liverpool SAB de CV (Liverpool) in a deal that will take the fashion department store giant private. The all-cash transaction is valued at $6.25 billion.
Erik, Pete and Jamie Nordstrom, along with other members of the Nordstrom family, and Liverpool plan to acquire all the outstanding common shares of Nordstrom that they do not already beneficially own. The deal would give the Nordstrom family a majority ownership stake (50.1 percent) in the Seattle-based retailer, with Liverpool owning 49.9 percent of the company.
“For over a century, Nordstrom has operated with a foundational principle of helping customers feel good and look their best,” said Erik Nordstrom, CEO of Nordstrom, in a prepared statement. “Today marks an exciting new chapter for the business. On behalf of my family, we look forward to working with our teams to ensure Nordstrom thrives long into the future.”
Under the terms of the agreement, Nordstrom common shareholders will receive $24.25 in cash for each share of Nordstrom common stock they hold, which represents a premium of approximately 42 percent to the unaffected closing common stock price for Nordstrom on March 18, 2024 — the last trading day prior to media speculation regarding a potential transaction. When the special committee appointed by Nordstrom’s board of directors confirmed receipt of the offer in September, the price was set at $23 per share.
Additionally, the board of directors, which unanimously approved the transaction, intends to authorize a special dividend of up to $0.25 per share immediately prior to (and contingent on) the close of the transaction. Erik and Pete Nordstrom recused themselves from the board decision.
The deal is expected to close in the first half of 2025, subject to regulatory approvals and approval of holders of two-thirds of Nordstrom’s common stock, as well as a majority from the holders of Nordstrom shares not owned by the Nordstrom family, Liverpool or their affiliates.
The transaction will be financed through a combination of rollover equity by the Nordstrom family and Liverpool, cash commitments by Liverpool, up to $450 million in borrowings under a new $1.2 billion bank financing and cash on hand.
Consultants for Nordstrom’s special committee on the deal include Morgan Stanley & Co. LLC and Centerview Partners LLC (financial advisors) and Sidley Austin LLP and Perkins Coie LLP (legal counsel). Advisors for the Nordstrom family include Moelis & Co. LLC (financial advisor) and Wilmer Cutler Pickering Hale and Dorr LLP, Lane Powell PC and Davis Wright Tremaine LLP ( legal counsel). Liverpool’s consultants include J.P. Morgan Securities LLC (financial advisor) and Simpson Thacher & Bartlett LLP and Galicia Abogados SC (legal counsel).
Founded in 1901, Nordstrom operates more than 350 physical stores under its namesake brand, as well as its discount brand Nordstrom Rack and its services-based specialty concept Nordstrom Local. Both Nordstrom Rack and Nordstrom Local operate within much smaller footprints than traditional Nordstrom department stores, which average 140,000 square feet in size.
Nordstrom’s stock price closed at $24.17 per share on Monday, Dec. 23, up from $18.75 a year ago, a nearly 29 percent increase.
— John Nelson