Nordstrom to be acquired by the Nordstrom family and a Mexican retail group in a $6.25 billion deal

Century-old department store Nordstrom has agreed to be acquired and taken over by Nordstrom family members and a Mexican retail group in a $6.25 billion deal with the industry is under pressure of discount chains and other competition.

Public companies are under much more scrutiny, and if private, Nordstrom’s may have more leeway to revive a department store chain that, like others, has looked to revive sluggish sales for years.

Nordstrom shareholders will receive $24.25 in cash for each share of Nordstrom common stock, or about $4 billion in total, representing a 42% premium on the company’s stock per share. March 18, when reports of a potential transaction were reported by the media.

Nordstrom’s will also take on more than $2 billion in debt.

Rivals like Macy’s and Kohl’s have been pressured by large investors to make major changes to return more profits to shareholders. The traditional department stores face competition from giants like Walmart and Target, as well as a host of fast-fashion bands and Amazon.com.

Sales at Nordstrom have largely declined in the last decade or so.

The offer announced Monday tops the previous offer of $23 per share. stock that the Nordstrom family and Mexican retail group El Puerto de Liverpool divested in September.

The board also plans to approve a special dividend of up to 25 cents per share. per share, based on Nordstrom’s cash on hand immediately prior to and contingent on the closing of the transaction.

The transaction is expected to be completed in the first half of 2025, when the company’s shares will no longer trade publicly.

Nordstrom’s board unanimously approved the proposed transaction, with members Erik and Pete Nordstrom, part of the Nordstrom family, taking over the company — recusing themselves from that vote.

Upon completion of the transaction, the Nordstrom family will hold a majority stake in the company.

Erik and Pete Nordstrom are the fourth generation of leadership at the Seattle retailer, which was founded in 1901 as a shoe store. Erik is the company’s managing director, and Peter is chairman.

Nordstrom shares fell about 1% at the opening bell, but are up 34% this year on rumors of a family takeover.

After opening 23 new stores so far this year, the company now operates a combined 381 Nordstrom and Nordstrom Rack stores in the U.S.