The Neiman Marcus chain was sold for $6 million to private investors. The sale to Ares Management and Canadian Pension Plan is expected to close by the end of the year.
Ares Management specializes in purchasing struggling companies. Canadian Pension Plan primarily invests in real estate. Both companies will own an equal share of the luxury retail chain.
As reported by USA Today, the new owners plan to invest in the continuation and growth of Neiman Marcus.
TPG Capital and Warburg Pincus have owned the retail chain since 2005. The sale comes after exploring a number of options, including an initial public offering.
Faith Hope Consolo, of Douglas Elliman Real Estate, says TPG and Warburg have made several attempts to “exit their investment.” The company continues to make a profit. However, sales have decreased since last year.
Mark Cohen of Columbia Business School says the deal will be positive for Neiman Marcus. He explains that their “seasoned management bench” will help the company remain competitive through the change.
Neiman Marcus’ remained competitive through the recession by adding online shopping and customer loyalty programs. Their reputation for providing great customer service is unprecedented.
The luxury retail chain is base in Dallas, Texas.
As reported by ABC News, Neiman Marcus was founded by Herbert Marcus Sr., Carrie Marcus, and A.L. Neiman, in 1907.
Broadway-Hale purchased the company in 1969. Following the purchase, Neiman Marcus expanded to other states.
There are currently 79 Neiman Marcus stores nationwide. They also offer many of their products online.
One of Neiman Marcus’ biggest competitors, Saks Fifth Avenue, was also recently sold. Saks Incorporated was sold to Hudson’s Bay Company for $2.4 billion. Hudson’s Bay owns luxury retailer Lord & Taylor.
The sale of Neiman Marcus is expected to give the company a boost in their competition with luxury retailers nationwide.
[Image via Wikimedia]