What: Nordstrom enters USD 6.25 billion privatisation agreement with family ownership and Liverpool, representing a 42% premium for shareholders and establishing a significant North American-Mexican retail alliance.

Why it is important: This privatisation represents a strategic response to department store challenges, combining Nordstrom's legacy with Liverpool's proven growth model, while freeing the business from public market pressures to implement long-term transformation strategies.

The Nordstrom family and El Puerto de Liverpool have reached a definitive agreement to acquire Nordstrom in a transaction valued at approximately USD 6.25 billion. Under the terms, shareholders will receive USD 24.25 per share in cash, representing a 42% premium to the company's unaffected closing price on March 18, 2024. The board also intends to pay a special dividend of up to USD 0.25 per share upon closing. Following the transaction, the Nordstrom family will maintain majority control with a 50.1% stake, while Liverpool will hold 49.9%.

The deal, unanimously approved by Nordstrom's Board of Directors through a special committee, marks a significant evolution in the company's 123-year history. The transaction will be financed through a combination of rollover equity, cash commitments by Liverpool, up to USD 450 million in borrowings, and company cash on hand. Existing senior notes and debentures totalling USD 2.7 billion will remain outstanding.The privatisation is expected to close in the first half of 2025, subject to regulatory approvals and shareholder consent, including approval from two-thirds of common stockholders. This strategic move aims to provide Nordstrom with greater flexibility to pursue long-term growth initiatives while maintaining its commitment to customer service excellence.

IADS Notes: The Nordstrom-Liverpool acquisition marks a pivotal moment in department store evolution. As reported in September 2024 , department stores have seen their market share plummet from 14% to less than 3% since 1993, driving the need for strategic transformation. This deal follows broader industry consolidation trends observed in December 2024 , including the Saks-Neiman Marcus merger, suggesting a shift towards private ownership as a means of implementing long-term strategic changes.

The timing appears strategic, as noted in July 2024 , with privatization offering Nordstrom greater operational flexibility away from quarterly reporting pressures. Liverpool brings significant strength to this partnership, having demonstrated robust growth with a 9.4% revenue increase in 2024 , potentially offering Nordstrom valuable insights into successful department store operations in an evolving retail landscape.

Nordstrom to Be Acquired by Nordstrom Family and Liverpool