Article Content:Article Content: Saks Owner Buys Neiman Marcus for $2.65 Billion HBC, the parent company of Saks Fifth Avenue, has announced the acquisition of Neiman Marcus for $2.65 billion. The deal aims to strengthen HBC’s bargaining power with suppliers and optimize cost management. Luxury retailers have been facing challenges due to rising interest rates and inflation, leading to reduced consumer spending. HBC plans to establish Saks Global, which will incorporate Saks Fifth Avenue, Neiman Marcus, and other luxury retail and real estate assets. Neiman Marcus previously filed for bankruptcy in 2020 amidst the pandemic-induced closure of stores. HBC’s acquisition will allow Neiman Marcus to continue operating and cater to its high-end customer base. The combined entity, Saks Global, will be led by Marc Metrick, the CEO of Saks’ e-commerce business. It will compete with other luxury retailers such as Nordstrom, Bloomingdale’s, and Macy’s. Amazon and Salesforce will also provide support with technology, logistics, and AI integration. Rhone Capital, an existing investor in HBC, will lead the investment in Saks Global. The deal is financed through a combination of cash from shareholders, debt, and a $1.15 billion debt financing from Apollo Global Management. HBC has also secured $2 billion in debt financing from Wall Street banks. Disclaimer: The investment advice provided by experts on Sharepriceindia.com is their own opinion and does not represent the views of the website or its management. Users are advised to consult with certified experts before making any investment decisions.
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Saks Fifth Avenue parent HBC announced Thursday that it will buy Neiman Marcus, the luxury department store chain, for $2.65 billion. The acquisition will give HBC more leverage in negotiations with suppliers and help them better manage costs. The deal comes as luxury retailers face weaker demand due to high interest rates and inflation, which has caused customers to cut back on spending after a post-pandemic luxury retail boom.
HBC plans to create Saks Global, combining Saks Fifth Avenue, Neiman Marcus and other luxury retail and real estate assets.
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Neiman Marcus filed for bankruptcy in 2020 after the pandemic forced the closure of its stores in the U.S., severely impacting the company’s revenue. Neiman Marcus is known for selling high-end products such as designer dresses, shoes and handbags to wealthy customers.
On Wednesday it was reported that HBC had agreed to acquire Neiman Marcus.
Marc Metrick, CEO of Saks’ e-commerce business, will lead the new combined company. Saks Global will compete with Nordstrom, Bloomingdale’s and Macy’s, which is reportedly in talks to sell itself for about $6.9 billion. Amazon and Salesforce will also invest in Saks Global, providing technology, logistics and AI integration help.
Rhone Capital, an existing investor in HBC, will be the lead investor in Saks Global. HBC is financing the deal with cash from new and existing shareholders and debt, with Apollo Global Management providing $1.15 billion in debt financing. HBC has also secured $2 billion in debt financing from several Wall Street banks.
JPMorgan and Lazard acted as financial advisors to Neiman Marcus Group on the deal.
Disclaimer: The opinions and investment tips of investment experts on Sharepriceindia.com are their own and not those of the website or its management. Sharepriceindia.com advises users to consult certified experts before making any investment decisions.
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