Huge Debts Pressed Niemann Department Store To Sell Electricity Supplier Mytheresa To Repay Debts

Us luxury department store retailer Neiman Marcus Group LTD LLC, the "Ni NMG" group, announced the strategic choice of the German luxury electric business MyTheresa, including the sale, hoping to reduce the debt of up to US $6 billion. "Marcus"

NMG's MyTheresa acquired in 2014 has recently become the focus of disputes between the group and its creditors.

In September last year, NMG pferred MyTheresa to its parent company TheNeiman Marcus Group Inc., which was bought by the private equity Holdings Company of the luxury department store in 2013 for $6 billion, Ares Management LP and Canada Pension Canada, Canada's pensions Investment Committee, which means that the strong growth and good benefits have been completely out of touch with the creditors.

Marble Ridge Capital LP, as one of the creditors, initiated a lawsuit against NMG, but the case was not accepted by the court.

NMG revealed that MyTheresa achieved 272 million euros in sales and 15 million 290 thousand euros in profit in the first nine months ended March 31st.

In the five years after joining the NMG brand portfolio, the revenue growth of the electricity supplier is nearly two times, and the current valuation is about 1 billion dollars.

In contrast, Matchesfashion.com Ltd., a luxury online retailer in the UK, sold a controlling stake to Apax PartnersLLP in 2017 at 800 million pounds (unofficially confirmed). In September last year, the Fashion Stylish online trading platform, Farfetch Ltd. (NYSE:FTCH), also originated in the United Kingdom, raised $885 million in the NYSE IPO, with a market value of more than $7 billion 500 million.

Bloomberg quoted NMG as saying that MyTheresa hopes to sell 500 million euros.

Analysts believe that the sale of MyTheresa cash is a win-win outcome for NMG and creditors.

As the group announces its intention to divest MyTheresa, it proposes to replace a group of 2021 maturity bonds with new bills and part MyTheresa common stock rights, which means that the unsecured creditors will qualify for profit from MyTheresa pactions.

At the end of March, NMG had taken the lead in restructuring some of its debts, extending over 55% of the term loan to 2023, and extending the period of 60% unsecured bonds to 2024 and repaying 550 million dollars in debt.

As of January 29, 2019, NMG's long-term debt amounted to US $6 billion 43 million 100 thousand.

The sale of MyTheresa does not mean that NMG has taken a defensive stance in the e-commerce market.

In fact, the group has just acquired a minority stake in the second hand luxury electric business Fashionphile in mid April.

The online sales business has contributed more than 1/3 sales to NMG. After the MyTheresa was removed, online sales in the first nine months still exceeded $500 million.

In its 8-K file submitted to the SEC, the group also expects the same store sales decline in the three quarter ending April 27th, ending the six consecutive quarter of growth, even though the two quarter growth has narrowed to 0.7%.

During the three quarter, Neiman Marcus, Marcus Hudson, which has been established for more than 110 years and is still rooted in Dallas, Dezhou, has made its first entry into New York. In the latest shopping and tourism landmark Hudson Yards, it has opened three floor department stores with an area of 17 thousand and 500 square meters, aiming at the local rich and tourist market.

NMG's Bergdorf Goodman department store is a luxury department store in New York.