13 September 2017 by lberuti
Though JWN’s (Nordstrom, Inc) sales have slowed, the company has generally performed better than most department store chains and since June JWN’s founding family has been mulling solutions to go private. When the rumours first surfaced, JWN’s 5-year risk premium jumped from 160bps to 320bps but it has then trended back tighter and it was trading at 230bps yesterday. Overnight press reports mentioned that family members, who own more than 30% of the retailer, are close to picking a private equity firm, Leonard Green & Partners, to help put a buyout together. Leonard Green would provide $1bln in equity which would help raising $7 to $8bln in debt in order to finance a deal that could be formally announced in a couple of weeks. The perspective revived investors’ worries, and they pushed JWN’s 5-year risk premium 61bps wider to 293bps, en route to exceed the widest levels of this summer.