Timing the Neiman Marcus Deal

A Key to sale of Neiman Marcus Inc.

Would be knowing when to make a deal.

 

As private  market equity deals go, TPG and Warburg Pincus’ 2005 acquisition of Neiman Marcus Inc. is getting long in the tooth– big money investors typically spend five to seven years tweaking a company before trying to cash in.

So with the stock market   near its all-time high and interest rates still low, Neiman’s is working with Credit Suisse, which, according to sources, is taking a “dual track” approach, exploring an initial public offering or alternatively an outright sale to  another investor.

But the private equity companies could also choose to stick with Neiman’s longer, an option that might be causing some friction between  the two investors. Afinacial source said TPG was content to hold on to the investment, while Warburg Pincus is more keen to unload the luxe retailer now. Other sources close to the investors maintain there is no disagreement.

At least half the risk to investing is knowing when to sell, so it wouldn’t be surprising if TPG and Warburg had differing views on when to get out. One banker noted that TPG, if they were reticent, is interested enough to explore ways to exit the investment and would jump out if the right chance came along.

The landscape for Neiman’s is a tricky one right now…..

story by: Evan Clark

 

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