UPDATE 2-Neiman Marcus close to changing private equity owners -sources

Sun Sep 8, 2013 7:05pm EDT
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By Greg Roumeliotis

NEW YORK, Sept 8 (Reuters) - A consortium of Ares Management LLC and the Canada Pension Plan Investment Board is in advanced talks to acquire upscale U.S. retailer Neiman Marcus Inc from TPG Capital LP, Warburg Pincus LLC and Leonard Green Partners LP, two people familiar with the matter said on Sunday.

A deal for Neiman Marcus could be announced as early as this week and would mean that the company would not proceed with its plans for an initial public offering, the people said, asking not to be identified as the negotiations are confidential.

One of the people said the deal would likely value Neiman Marcus at around $6 billion, but cautioned that negotiations had not been finalized and that talks could still fall apart.

Neiman Marcus, Ares, TPG, Warburg Pincus and the Canada Pension Plan Investment Board declined to comment. A Leonard Green spokeswoman did not respond to requests for comment.

Neiman registered for an IPO in July after earlier talks with potential buyers, including sovereign wealth funds, failed to meet the price expectations of its private equity owners, people familiar with the matter told Reuters at the time.

The decision to pursue a sale to other private equity firms could underscore uncertainty by its owners over how the stock market would value Neiman, as well as a desire to monetize on their investment more quickly.

Last month, Neiman rivals Saks Inc and Nordstrom Inc each reported disappointing sales gains for the second quarter, raising concerns that even high-end shoppers were cutting back on spending.   Continued...