Nordstrom could go private in family deal as department stores struggle

KING 5's Dan Cassuto reports.

The heirs to the Nordstrom department-store chain are exploring a bid to acquire the company that bears their family name in a deal that would turn the publicly traded company into a private venture amid considerable turbulence for the sector.

The luxury retailer said Thursday that several members of the Nordstrom family, including multiple company executives, had formed a group to weigh the potential acquisition.

Although financial details of the potential deal were not released, the company's shareholders reacted enthusiastically, driving shares up 20.5% in pre-market trading to $48.79.

The company had suffered a serious setback after a disappointing first-quarter earnings report May 11, which caused its stock to lose nearly a fifth of its value. Sales at Nordstrom stores open at least a year fell 0.8% during the period.

Though the company projected flat same-store sales for the current fiscal year, CFRA Research analyst Efraim Levy estimated sales would be "slightly down."

Nordstrom said Thursday that it had formed a special committee of independent directors and hired legal and financial advisers to evaluate the possibility.

The potential shakeup comes amid a period of upheaval for department-store chains, which are facing declining mall traffic and intense online competition.

The family members considering the bid are Co-Presidents Blake Nordstrom, Peter E. Nordstrom and Erik Nordstrom; President of Stores James Nordstrom; Chairman Emeritus Bruce Nordstrom; and Anne Gittinger.

Their ancestor, John W. Nordstrom, and Seattle shoemaker Carl Wallin jointly opened the Wallin & Nordstrom shoe store in 1901. After evolving and growing into a nationwide independent shoe chain, the company that became known as Nordstrom started selling women's clothing in 1963.

It went public in 1971, and sales exceeded $100 million two years later.

© 2017 KING-TV


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