Neiman Marcus Mulls “Strategic Alternatives”

Dallas-based cataloger/retailer Neiman Marcus Group has hired investment banker Goldman Sachs & Co. to help it explore “strategic alternatives” to enhance shareholder value, including a sale.

In addition to its Neiman Marcus and Bergdorf Goodman stores, the company mails the Neiman Marcus and Horchow catalogs. The company specializes in selling high-end apparel and home decor to affluent consumers.

Neiman Marcus’s March 16 announcement comes a day after published reports said that Sears, Roebuck & Co. was shopping around its Lands’ End division. “This looks like the time to capitalize on a well-established brand,” says Mike Petsky, CEO of New York-based investment bank Petsky Prunier. “The high multiples in a competitive marketplace make it a good time to be a seller if you have a well-defined brand such as Neiman Marcus.”

Neiman Marcus has experienced solid sales growth during the past few years. For the fiscal year ended July 31, 2004, its revenue was nearly $3.55 billion, up more than 14% from $3.10 billion the previous year. Direct sales grew more than 15% during the same period, to $571 million, while operating earnings climbed 56%, to $345.2 million.