Private equity firm KKR is considering an investment in Saks and may push to merge the upscale department store with rival retailer Neiman Marcus, according to a report from Bloomberg News.
It’s unclear whether KKR has approached Saks about a potential investment thus far, and a source told Bloomberg that there’s no guarantee that a transaction will occur. But retail experts say such a combination would make sense for both the Saks and Neiman Marcus brands, which are battling their much larger competitor Nordstrom.
The primary reason for a merger would be to stimulate growth, and to allow a combined company to use its newfound size to keep down costs by integrating back-end logistics, said Brian Sozzi, CEO and chief equities strategist of Belus Capital Advisors. “It would create a luxury department store with immediate scale,” said Sozzi. “Both of these companies lack large store bases.”
Private equity firm KKR is considering an investment in Saks and may push to merge the upscale department store with rival retailer Neiman Marcus, according to a report from Bloomberg News. It’s unclear whether KKR has approached Saks about a potential investment thus far, and a source told Bloomberg that there’s no guarantee that a transaction will occur. But retail experts say such a combination would make sense for both the Saks and Neiman Marcus brands, which are battling their much larger competitor Nordstrom.The primary reason for a merger would be to stimulate growth, and to allow a combined company to use its newfound size to keep down costs by integrating back-end logistics, said Brian Sozzi, CEO and chief equities strategist of Belus Capital Advisors. “It would create a luxury department store with immediate scale,” said Sozzi. “Both of these companies lack large store bases.”
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