65 Billion Deal

In a move to consolidate their presence in the luxury retail market, HBC, the parent company of Saks Fifth Avenue, announced on Thursday their plans to acquire the Neiman Marcus Group. The deal, valued at $2.65 billion, will establish a new entity called Saks Global, encompassing Saks Fifth Avenue, Saks OFF 5TH, Neiman Marcus' namesake department store chain, and Bergdorf Goodman.

The acquisition marks a significant milestone in the luxury retail industry, with HBC CEO Richard Baker expressing his enthusiasm for bringing together these iconic luxury names. In a statement, Baker stated that industry insiders have long anticipated this transaction and its potential benefits for customers, partners, and employees.

Baker also emphasized the exciting opportunities presented by technological advancements, which have the potential to redefine the customer experience in luxury retail. As part of the deal, Saks.com CEO Marc Metrick will assume the role of chief executive for the newly formed Saks Global business. Ian Putnam, president and CEO of HBC Properties and Investments, will lead Saks Global's property and investments business. Both Metrick and Putnam will report to Baker, who will serve as the executive chairman at Saks Global.

Neiman Marcus Group CEO Geoffroy van Raemdonck hailed the partnership as a proactive choice in an evolving retail landscape. The traditional brick-and-mortar retail sector has faced challenges amidst the rise of e-commerce, exacerbated by a shift in consumer spending preferences due to the pandemic. The demand for experiences such as dining out or traveling has taken precedence over discretionary spending on goods.

This acquisition comes at a crucial time for the department store segment, which has been grappling with attracting younger shoppers and adapting to changing consumer preferences. By combining their resources and expertise, Saks Global aims to navigate the evolving retail landscape and stay competitive in an increasingly digital and experiential market.

The completion of the deal remains subject to regulatory approval, but if successful, it promises to reshape the luxury retail landscape and redefine the customer experience offered by Saks Fifth Avenue, Neiman Marcus, and their affiliated brands.