Nordstrom's stock (NYSE:JWN) surged by 5.4% following reports of the founding family's renewed interest in a takeover. The company's CEO and president have expressed their inclination towards exploring a private deal, as per sources familiar with the matter. This development comes after previous reports of Nordstrom reaching out to private equity firms for a potential deal. In 2018, Nordstrom had turned down a takeover offer from its founding family at $50 per share.
Key Takeaways
- Nordstrom (NYSE:JWN) saw a 5.4% increase following reports of its founding family considering a renewed takeover offer.
- CEO Erik Nordstrom and President Pete Nordstrom have expressed their interest in exploring a take-private deal.
- Reuters previously reported that Nordstrom (JWN) engaged investment banks and private equity firms for a potential deal.
- The founding family's 2018 offer of $50 per share for a takeover was rejected by Nordstrom (JWN).
- Speculation around Nordstrom's potential take-private deal has positively impacted the stock's performance.
Analysis
Nordstrom's (NYSE:JWN) stock surged by 5.4% after reports of the founding family's renewed interest in a takeover. The CEO and president's inclination towards a private deal and the previous engagement with private equity firms indicate a potential buyout. In the short-term, this could lead to stock price volatility and heightened speculation. Long-term consequences may include significant changes in the company's operations, impacting shareholders and employees. The effects would extend to the investment banks and private equity firms involved in the potential deal. If the buyout occurs, it may lead to a reshaping of Nordstrom's business strategy and market positioning.
Did You Know?
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Take-private deal: A take-private deal involves a public company, such as Nordstrom, being acquired by a small group of investors or a single entity to make it a private company. This process usually involves delisting the company from the stock exchange and can allow the acquiring parties more control over the company's operations and strategy.
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Engaging investment banks and private equity firms: When a company like Nordstrom engages investment banks and private equity firms, it indicates that the company is actively seeking financial advisory services and potential investment partners for strategic initiatives such as mergers, acquisitions, or restructuring. This suggests Nordstrom is exploring various options to potentially restructure its ownership or operations.
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Rejected takeover offer at $50 per share: The founding family's previous offer of $50 per share for a takeover was rejected by Nordstrom. This could indicate that the company's leadership believed the offer undervalued the company at that time, and they are now expressing renewed interest in exploring a private deal, which has positively impacted the stock's performance.