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Neiman Marcus Sells for $6B

Published By: The Retail Report
Luxury retailer Neiman Marcus has sold for $6 billion. Major shareholders Warburg Pincus and TPG, which concentrate 98.07% of the equity, sold to Ares Management and the Canada Pension Plan Investment Board (CPPIB) seven years after the company was taken private for $5.1 billion. Warburg and TPG sunk in $1.2 billion to fund the leveraged buyout.

Selling the company to Ares and CPPIB was an alterative the former private equity backers had mulled, even as they had fined for an initial public offering of Neiman Marcus. Regulatory documents show Warburg and TPG meant to IPO in order to exit the investment, as none of the capital would have gone back to the company.

Retailer Neiman Marcus counts 79 stores and over 6.5 million gross square feet. The company sits on $2.7 billion in long-term debt, including debentures expiring in 2028. The company runs 41 Neiman Marcus stores, two Bergdorf Goodman locations in Manhattan, and 36 Last Call outlet centers. Although private equity firms have kept a close eye on Neiman, with KKR pushing for a merger with Saks earlier this year, Hudson’s Bay acquired Saks for $2.4 billion in cash this July.

Ares is currently an owner of 99¢ Only Stores, Floor & Décor Outlets of America Inc., and Smart & Final Stores LLC, according to the Ares website.

[Wall Street Journal]


Release Date09/12/2013 - 07:00


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