Nordstrom's approach to privatization stalls

The Nordstrom family's attempts to take their namesake company private has stalled due to issues with financing.

Currently, the Nordstrom family is working with Leonard Green to provide equity financing for the deal, but they will need bank support for the debt financing. Both equity and debt financing are needed before a bid can be submitted to the independent special committee it has appointed to review any offer.

Nordstrom's attempt at privatization faltering

The retail landscape is very tough, so banks are very reluctant to provide equity and debt financing to retail companies. Leonard Green is very conservative about the amount of equity it is willing to put forth and the debt financing it is willing to swallow.

It's a race against the clock as the holiday season approaches, a time where retail sales are the strongest, but a difficult time to put together a business deal. The chances of a deal happening soon are increasingly unlikely.

The Nordstrom family currently owns 31.2 percent of the stake in the company, but in June they said they were attempting to take the company private.

photo: via Nordstrom Facebook page




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