100-year-old US luxury fashion retailer Neiman Marcus files for IPO of $100 million
Neiman Marcus Group Inc., a US luxury fashion retailer, has filed for an Initial Public Offering of $100 million in its bid to go public – the second attempt in two years running.
Backed by the Canadian Plan Investment Board (CPPIB) as well as the Ares Management LP, 100-year-old Neiman Marcus deals in apparels, shoes, cosmetics, handbags, and designer jewelries among others.
It is based in Dallas and manages 41 stores under the Neiman Marcus brand, but then it also owns Bergdorf Goodman on Manhattan’s Fifth Avenue as well as Last Call off-price chain.
It was formerly owned by TPG Capital and Warburg Pincus – who thought about going public with an IPO in July 2013, but later thought against it and then sold off the company to CPPIB and Ares Management for $6 billion.
Neiman Marcus feels the need to go for an IPO because there are strong indications its North America luxury market will exceed global overseas sales within a short time to come. The global market is estimated to grow a year at 3.6% rate, but that of the North America luxury market has a potential for 4.1% rate – according to Euromonitor International.
Meanwhile, the risen gain of Jimmy Choo’s shares to 17.5% since it joined the London Stock Exchange in 2014 is encouraging Neiman Marcus to toe that path.
Almost all of Neiman Marcus’ products are sold under the Bergdorf Goodman, MyTheresa, and Neiman Marcus brands; and then a study reveals 38% of its customers have an average income of over $200,000.
It also sells products made by Chanel, Prada, Louis Vuitton, and Gucci among others, and it makes around 40% of its revenue from members within its “InCircle loyalty program – these spend nearly 11 times over what other customers pay for.
In fiscal year ending August 2, 2014, the revenue of Neiman Marcus increased by 4.1% to $4.84 billion, and the organization has succeeded in posting sales growth in 22 consecutive quarters through to third quarter of 2015 fiscal year. However, it posted a loss of $147.2 million against a profit of $163.7 million a year earlier.
Neiman Marcus intends to list its shares under the “NMG” symbol as soon as approval is given.