Swedish-Rooted Nordstrom Goes Private
Nordstrom, the iconic retailer founded by Swedish immigrant John W. Nordstrom, is set to go private in a $6.25 billion deal. The company was founded in Seattle in 1901, but the San Francisco Bay Area has played an important part in the department store's journey.
The buyout, led by the Nordstrom family and Mexican retailer El Puerto de Liverpool, marks a new chapter for the company as it steps away from public markets.
In a statement, Erik Nordstrom, the company's chief executive and the fourth generation of his family to run it, noted the chain’s longevity in the retail industry.
“Today marks an exciting new chapter for the business. On behalf of my family, we look forward to working with our teams to ensure Nordstrom thrives long into the future,” Mr. Nordstrom said.
The retailer's decision to go private comes as it faces challenges in a changing consumer landscape. Shareholders will receive $24.25 per share, a 42% premium over the March 18 closing price. The Nordstrom family will retain a majority stake of 50.1%, while Liverpool will hold the remaining 49.9%. The transaction will be financed through equity contributions, $1.2 billion in loans, and company cash reserves.
This buyout follows a previous unsuccessful attempt to take the company private in 2018.
In 1887, John W. Nordstrom, at 16 years old, left Sweden for the United States. He arrived in New York with $5 in his pocket, unable to speak a word of English.
The young immigrant labored in mines and logging camps as he crossed the country to California and Washington. In 1897, he headed north to Alaska and the Klondike in search of gold. Two years later, he returned to Seattle with a $13,000 stake, ready to settle down.
Carl F. Wallin, a Seattle shoemaker Nordstrom had met in Alaska, offered him a partnership in a shoe store. In 1901, they opened their first store, Wallin & Nordstrom, at Fourth and Pike in Seattle.
Nordstrom's first San Francisco Bay Area store opened in November 1984 at the Stanford Shopping Center in Palo Alto.
The decision to open a flagship store at the San Francisco Centre in 1988 marked a milestone in the retailer’s history. Located in the heart of downtown, the store became a centerpiece of the city's luxury retail scene, reinforcing Nordstrom’s reputation as a destination for fashion-conscious shoppers. After 35 years of operation, Nordstrom closed its flagship store in San Francisco on August 27, 2023.