The parent company of Saks Fifth Avenue, in partnership with Amazon, will buy rival department store chain Neiman Marcus in a deal valued at $2.65 billion.
Richard Baker, CEO and chairman of HBC, told The New York Times that the company has “no plans to close any stores or digital businesses or reduce service in any way,” even though the chains operate in many of the same markets.
Part of the appeal was the personal touch, Baker said. “Customers love going into a store,” he said. “They love touching a product and spending time with their personal shoppers.”
Also attractive was Neiman Marcus’ sales force. “People have forgotten how important people are. When you sell luxury products, you need beautiful stores and salespeople who trust customers,” he said.
The deal was first reported by the Wall Street Journal.
The two chains have been negotiating for months and have repeatedly explored the deal in recent years, the newspaper said. The combination is likely to face regulatory scrutiny as the Federal Trade Commission takes a closer look at consolidation in the fashion retail industry.
The combined company would have annual revenues of about $10 billion, according to sources familiar with the transaction.
Amazon will take a minority stake in the new company and provide technology and logistics expertise, the Wall Street Journal reported. The new company will be called Saks Global. Another minority shareholder is Salesforce, the newspaper reported.
HBC, a holding company that owns Sak’s and Hudson’s Bay, is financing the deal with $2 billion it raised from existing investors, the Wall Street Journal reported. HBC did not respond to a request for comment.
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The newspaper also reported that Marc Metrick, the CEO of Sak’s e-commerce unit, will lead the combined companies.
Betty Lin-Fisher is a consumer reporter for USA TODAY. Reach her at [email protected] or follow her on X, Facebook or Instagram @blinfisher. Sign up here for our free newsletter The Daily Money, with consumer news every Friday.