Neiman Marcus plans IPO that will help pay debt to CPPIB

Neiman Marcus, a U.S. luxury retailer with a substantial stake held by the Canada Pension Plan Investment Board, is planning to list its shares in New York.

Luxury retailer anticipates expansion with affluent consumers in Asia, North America

The CPPIB owns a substantial stake in Neiman Marcus. The luxury retailer will list its shares later this year. (M. Spencer Green/Associated Press)

Neiman Marcus, a U.S. luxury retailer with a substantial stake held by the Canada Pension Plan Investment Board, is planning to list its shares in New York.

In an SEC filing Tuesday, Neiman Marcus said it would raise up to $100 million US on the markets. That figure is likely just a placeholder until a specific share price and timing can be set.

The retailer said it anticipates expansion of the luxury retail market and needs cash to upgrade stores and pay down debt.

It also plans to invest in payments security after a hacking attempt in January 2014 that exposed data on some customers.

Ares Management and CPPIB bought a majority stake in Neiman Marcus in 2013 for $6 billion, heading off an earlier plan for the retailer to go public.

According to the S1 filing, they hold most of the shares of the company and plan to keep a majority stake even after the stock sale. However, both could benefit by selling part of their holdings during the IPO.

The CPPIB invests the portion of Canada Pension Plan savings that is not immediately needed to pay benefits. It has a huge portfolio of real estate, infrastructure and other investments around the world.

In addition to 41 Neiman Marcus stores in the U.S., the chain operates two Bergdorf Goodman stores and the My Theresa brand for younger consumers in Europe and Asia.

The retailer says it anticipates burgeoning luxury goods sales in Asia and the Middle East, as well as strong growth in North America, taking advantage of its strong online presence.

Neiman Marcus reported $3.9 billion in revenue over the last three quarters to Aug. 2 and a 4.5 per cent rise in comparable store sales. The company also reported a $47.8 million profit, though it lost $148 million for the entire fiscal year to Aug. 2.

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