Company board forms special review committee
Nordstrom Inc.’s board of directors has formed a special committee as part of the Nordstrom family’s decision to explore the possibility of taking the retailer private.
The company said in a statement Thursday that members of the Nordstrom family formed a group to explore a plan that could involve family members buying 100% of Nordstrom’s outstanding shares of common stock. Members of the family group include Nordstrom’s Co-Presidents Blake Nordstrom, Peter Nordstrom, and Erik Nordstrom; President of Stores James Nordstrom; Chairman Emeritus Bruce Nordstrom; and Anne Gittinger.
A proposal has not yet been presented to the company board, and no time line was provided by the family.
The board’s special committee has retained Centerview Partners LLC to serve as its financial advisor.
In an Amazon-altered retail space, traditional retailers, including Nordstrom, have been struggling to compete.
Going private could give the family, which owns 30% of the shares, time to focus on the company’s core business instead of trying to keep up with earnings expectations every quarter.
“Being out of the spotlight for a while could benefit some companies,” explains Trip Miller, managing partner at Gullane Capital Partners. “It buys them time if they really have a plan, allowing them to keep a laser focus on business instead of dealing with outside shareholders and the media.”
In May, Nordstrom reported its same store sales for the first quarter dropped 0.8%, and in April the company announced it was laying off as many as 400 employees, according to the Seattle Times. That came on the heels of a decision to cut 120 technology jobs at the retailer.
Nordstrom's woes don't seem to have impacted some of the family members' wallets. Blake, Pete and Erik Nordstorm saw their total compensation double to nearly $6 million last year.
It's unclear what an ownership change will mean for the retailer's board and governance. Recently, the company announced Stacy Brown-Philpot, the CEO of online odd jobs serves firm TaskRabbit, joined Nordstrom's board, replacing Enrique 'Rick' Henandez, Jr., saying she was bringing "ecommerce expertise" to the table.