Hudson’s Bay Company (HBC) has announced that it will acquire Neiman Marcus to merge it with its subsidiary Saks Fifth Avenue. Remarkably, Amazon is participating in the merger operation.
Two giants team up
HBC is paying almost 2.5 billion euros for Neiman Marcus, raising capital from its existing shareholders, as well as from external parties. Remarkably, Amazon and Salesforce are also contributing, taking minority stakes in the newly formed company. Their aim is to help the luxury department stores advance in AI and logistics, The Wall Street Journal reports on deal that has not yet officially been announced.
Saks and Neiman Marcus will continue under the new name Saks Global and jointly represent annual sales of ten billion dollars. Marc Metrick, today the CEO of Saks’ e-commerce business, will be its first CEO. Whether Belgian Geoffroy van Raemdonck, the current CEO of Neiman Marcus, will stay on board is still unknown.
The merger company hopes that the consolidation will strengthen its position in a troubled luxury market. The chairman and co-owner of Hudson’s Bay Company also recently acquired German department store chain Galeria, following the bankruptcy of its parent company Signa. After a record year, the luxury goods market is stagnating, Bain’s latest sector report suggest. Brands and retailers face tough dilemmas, but must continue to invest despite the uncertain times.
