Bergdorf Goodman store
© Bloomberg

Neiman Marcus, the venerable US luxury department store, has fired the starting gun on an initial public offering as the group’s private equity backers ready for an exit.

The Texas-based group purchased by Ares Management and the Canada Pension Plan Investment Board for $6bn in 2013 filed plans with US securities regulators on Tuesday to list shares publicly.

The retailer said it would use the proceeds from the offering to repay some of its debts. Neiman, known for its lavish holiday gift guides, listed more than $4.7bn in long-term debt in its prospectus.

The company operates 41 of its namesake stores, which carry goods from Valentino, Tom Ford, Goyard, and Louis Vuitton, as well as two Bergdorf Goodman department stores in Manhattan and 42 Last Call outlets.

Revenues in the company’s fiscal third quarter, which ran to May 2, climbed 5 per cent from a year earlier to $1.2bn, lifted by a 2.2 per cent increase in same-store sales. During the period, Neiman Marcus swung to a profit of $19.8m from a loss of $8m a year earlier.

The company said nearly four-fifths of its clientele were woman, while the median household income for 38 per cent of its shoppers eclipsed $200,000 a year.

Neiman Marcus and Bergdorf Goodman, venerated in the 2013 documentary Scatter My Ashes at Bergdorf’s, were scooped up by TPG Capital and Warburg Pincus for $5.1bn in 2005, several years before the financial crisis shook the luxury goods industry.

The two private equity groups, which had filed plans to take Neiman public, ultimately held on to the retailer for longer than the typical five-to-seven-year holding period for buyout groups before selling to Ares and CPPIB.

The listing plans come as the luxury retail sector grapples with intensifying online competition from the likes of Yoox, Net-a-Porter and Amazon, as well as a rejuvenated Saks Fifth Avenue, which was purchased by Canada’s Hudson’s Bay Company in 2013.

Oliver Chen, an analyst with Cowen & Company, said in June that he believed Neiman Marcus was a potential target of Hudson Bay, which could derail an IPO.

“HBC is a key potential acquirer of Neiman Marcus given the strength of Neiman’s brand, real estate portfolio, exposure to key brands, and ability to leverage HBC’s global infrastructure,” Mr Chen said.

Risk factors cited in the initial public offering included a deterioration in the economy, a cyber attack and its ability to maintain its image. The company also warned that its sales were highly concentrated in four states — half of its sales in 2014 were generated in California, Florida, New York and Texas.

As is customary at an early stage, Neiman Marcus did not specify which exchange it planned to float on nor the number nor price range of the shares to be sold.

Twitter: @ericgplatt

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