US Markets
Wednesday, January 10th, 2024 5:18 pm EDT
Key Points
- Neiman Marcus CEO Rejects Acquisition Rumors: Amidst speculations about a potential acquisition by Saks Fifth Avenue, Neiman Marcus CEO, Geoffroy van Raemdonck, asserts that there is “no need” to sell the business and it is unlikely to change hands in the next five years. He emphasized that there is currently no process in place to sell the company.
- Saks’ Bids and Merger Speculations: Saks Fifth Avenue, Neiman Marcus’ largest competitor, has reportedly made several bids to acquire the luxury retailer, including a recent $3 billion offer that was rejected. Industry insiders suggest that a merger between the two luxury retailers is inevitable, with some viewing it as a matter of when, not if. However, Neiman Marcus’ CEO denies any ongoing process for a sale.
- Ownership Dynamics and Future Plans: Neiman Marcus has been owned by Pacific Investment Management, Davidson Kempner Capital Management, and Sixth Street Partners since filing for bankruptcy in 2020. While acknowledging that the owners will eventually seek to offload the business, van Raemdonck indicates that it won’t happen anytime soon, possibly within the next five years. The decision to sell will depend on the owners, and as of now, no offer has been deemed attractive enough. The luxury retailer faced challenges with declining comparable sales trends during the recent holiday season. If a merger with Saks were to occur, potential benefits could include cost reductions, better vendor terms, and improved resilience against industry shifts affecting department stores.
Neiman Marcus CEO Geoffroy van Raemdonck has dismissed rumors of a potential acquisition by Saks Fifth Avenue, stating there is “no need” to sell the business, and it is unlikely to change hands in the next five years. Reports suggest that Saks has made multiple bids to acquire Neiman Marcus, including a recent $3 billion offer that was rejected. Industry insiders have suggested that a merger between the two luxury retailers is inevitable, but van Raemdonck emphasized that there is currently “no process to sell the company.” Neiman Marcus, which filed for bankruptcy in 2020 and is currently owned by Pacific Investment Management, Davidson Kempner Capital Management, and Sixth Street Partners, has not yet received an offer deemed attractive enough to prompt a sale. While acknowledging that the owners will eventually seek to offload the business, van Raemdonck indicated that it won’t happen in the near future, possibly within the next five years. Neiman Marcus faced challenges in the recent holiday season, with comparable sales trends down low single digits compared to the previous year. Despite the luxury retail environment’s volatility, van Raemdonck believes the company’s strategy execution and economic rebound will contribute to improved results. If a merger with Saks were to occur, cost reductions, better vendor terms, and enhanced resilience against industry shifts could be potential benefits for both companies.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/01/10/neiman-marcus-ceo-addresses-saks-sale-rumors.html
