The Nordstrom brothers, Erik and Pete, are making a second attempt to take their company private, following an unsuccessful effort in 2017. They have appointed a special committee to evaluate their offer and any others that may come in. The company, which has undergone significant changes since going public in 1971, is currently facing challenges with its off-price retailing in Nordstrom Rack stores. The board of directors’ special committee has hired financial and legal advisors to assist with the process.
The declining health of their father, Bruce Nordstrom, led the Nordstrom brothers to acquire ownership of a significant amount of the company’s common stock. Together, they now hold 9.52 percent of the outstanding shares, with the entire family owning around 30 percent. Street opinion suggests that the company will ultimately be taken private once the committee completes its evaluations. The goal of senior management is to privatize the company and have more autonomy in decision-making.
Nordstrom’s reputation for exceptional customer service and high standards in its stores has been a hallmark of the company. The Nordstrom’s have always been known for their attention to detail, sparkling stores, and caring associates. Even as the company considers going private, customers will likely continue to be drawn to Nordstrom for its unique shopping experience. The retail industry has seen the demise of many department stores, but there is hope that Nordstrom will continue to thrive and maintain its place in the market.
The Nordstrom Rack stores, which have been expanding rapidly, now outnumber the main Nordstrom stores. However, they lack the strong buying power of competitors like TJX and Burlington stores. The Rack stores have their own management team and are still trying to establish their identity within the company. With the future of Nordstrom potentially being taken private, it remains to be seen how the Rack stores will fit into the overall strategy of the company moving forward.
As the special committee continues to evaluate the Nordstrom brothers’ offer and any other potential bids, the company’s future remains uncertain. Nordstrom’s legacy of exceptional customer service and high-quality products has set it apart in the retail industry. The decision to go private will have implications for the company’s direction and long-term success. Nordstrom’s loyal customer base will be watching closely to see how the company navigates these changes and continues to provide the exceptional shopping experience it is known for.
