Last call for Neiman Marcus? The company just announced it has put itself on the market as sources report the company is in talks with Hudson’s Bay.
In its second quarter results, Neiman Marcus today said it is exploring options, including a sale, as it tries to improve its financial standing. The Wall Street Journal is reporting that Ares Management and the Canada Pension Plan Investment Board, which own the Neiman Marcus Group, are in talks with Hudson’s Bay.
Hudson’s Bay declined to directly confirm the rumor but told the paper, “Generally speaking, as we have previously stated, we selectively evaluate opportunities to accelerate the company’s strategic growth while maintaining or enhancing its credit profile.”
Last month, the Canadian retailer, which operates Saks Fifth Avenue and Lord & Taylor, was exploring a possible takeover of Macy’s. It was that activity that drew the attention of the Neiman Marcus investors, the sources say.
Neiman Marcus, which also operates Bergdorf Goodman and MyTheresa, like many of its retail peers, has been struggling. The company’s stock was downgraded by Standard & Poor’s last month to a CCC-plus from a B minus, due to ongoing retail challenges and consumer restraint. The company also scrapped a planned IPO and is saddled with $5 billion in debt.
Revenue for the quarter, ended January 28, dropped by 6.1 percent to $1.40 billion, compared to $1.49 billion in the same period of fiscal year 2016. For the six months, revenue decreased by 6.7 percent to $2.47 billion compared to $2.65 billion during the same period the year prior.
Comp store revenue decreased by 6.8 percent for the quarter and 7.3 percent for the full six months.