Neiman Marcus reaches $6 billion sale agreement

Dallas – Ares Management and the Canada Pension Plan Investment Board have reached an agreement to purchase Neiman Marcus for $6 billion from a group of investors led by TPG Capital and Warburg Pincus, the private equity firms that bought Neiman Marcus for $5.1 billion in 2005.



“We are delighted to join with CPPIB as a long-term investor in Neiman Marcus Group, a leading luxury retailer with global brand recognition that attracts shoppers from all over the world,” said David Kaplan, senior partner and co-head of the Private Equity Group of Ares. “We share a common vision with the company’s management team, led by its highly respected CEO Karen Katz, and together, we plan on investing meaningful capital into the business to ensure Neiman’s long-term position as the unparalleled leader in luxury retail.”



In a prepared statement, Kaplan also said the Neiman Marcus purchase fits Ares’ strategy of accelerating growth in retail and consumer companies. Ares and CPPIB will hold an equal economic interest in Neiman Marcus, and the company’s management will retain a minority stake. Neiman Marcus filed for an IPO in June, but there is no indication an IPO will take place following the purchase.



"On behalf of the entire management team, we are delighted to be joining with Ares and CPPIB to continue enhancing our strong brands by offering our customers the best edited merchandise assortments as well as delivering a superlative omnichannel shopping experience,” said CEO Karen Katz. “For the past eight years, TPG and Warburg Pincus have been valued partners whose investment has supported our growth and strengthened our brands."



The transaction is expected to close in the fourth quarter of 2013, subject to regulatory approvals and other customary closing conditions. Credit Suisse acted as financial advisor to Neiman Marcus Group, and RBC Capital Markets and Deutsche Bank Securities Inc. acted as financial advisors to Ares and CPPIB, all of which provided committed debt financing in connection with the transaction.