Nordstrom adopts a poisoned pill

Nordstrom adopts a poisoned pill

Mexican retailer Liverpool recently acquired 9.9% of Nordstrom
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Stocks as an investment for their idle money. While we believe Nordstrom’s management did not anticipate this benign move, it quickly adopted the Shareholders Equity Plan (also known as the Toxic Pill). Usually such a move makes the acquisition of a more expensive company.

Nordstrom’s board noted that the plan was adopted to protect the company’s interests when an unwelcome investor seeks to accumulate sufficient stock to control the company. However, management indicated that the plan was not adopted in response to any action.

The Rights Plan is generally effective immediately and will be valid for one year. The plan becomes enforceable only if a person or group acquires ownership of 10 percent or more of the outstanding shares in Nordstrom stock in a transaction not approved by Nordstrom’s Board of Directors.

Who is Liverpool?

Liverpool, or El Puerto de Liverpool, is a large Mexican company. The name comes from the port in England from which most of his goods are shipped to Mexico. Founded in 1845, today it has a range of many different store brands: 122 department stores called Liverpool, 167 stores in Suburbia as well as 50 Gap stores, Banana Republic, William Sonoma, West Elm and Pottery Barn. Sales in 2021 were 151 billion Mexican pesos ($7.8 billion). She has an estimated 40,000 colleagues. The CEO is Mr. Graciano Guichard Michel.

Liverpool stores usually carry a wide variety of high fashion merchandise. Fashion from France, England and the United States can be seen there, and models such as Valeria Mazza, Eva Herzigova, Gisele BΓΌndchen and Heidi Klum were featured in their advertisements.

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In the event of an unsolicited takeover being initiated, rights holders could purchase Nordstrom shares at a 50 percent discount, thereby obtaining a majority in any vote thereafter. Rights holders will be able to vote against any spam attack. Morgan Stanley
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A financial advisor to Nordstrom, Sidley Austin LLP serves as the firm’s legal advisor.

registration: While Liverpool is a great company, we believe Nordstrom management wants to remain independent. The family owns a lot of her company’s stock, which is estimated to be around 30 percent. A friendly deal is unlikely.

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