HBC, the parent company of luxury retailer Saks Fifth Avenue, has announced its acquisition of Neiman Marcus Group for a total enterprise value of $2.65 billion. The newly formed entity, Saks Global, will include both Saks Fifth Avenue and Neiman Marcus brands under one umbrella.
Marc Metrick, current CEO of Saks.com, will take on the role as CEO of Saks Global while Ian Putnam will become CEO of Saks Global Properties and Investments. This division will be responsible for managing HBC’s extensive portfolio worth $7 billion in retail real estate assets.
According to Richard Baker, executive chairman and CEO at HBC: “The industry has been anticipating this transaction for years due to its potential benefits for customers, partners and employees.” He also expressed excitement about leveraging technological advancements to enhance the customer experience.
Funding for this purchase is expected to come from a combination equity capital from new shareholders as well as existing ones along with debt facilities. Notably Amazon plans on investing in partnership with HBC post-transaction close while Salesforce is set to become an investor upon closing.
To finance this deal fully committed term loan financing worth $1.15 billion was secured through investment funds managed by affiliates Apollo alongside another fully committed revolving asset based loan facility valued at $2 billion led by Bank Of America,Citigroup,Morgan Stanley,RBS Capital Markets,and Wells Fargo respectively.
