Shares of Nordstrom, Inc. (NYSE:JWN) were gaining today after the department store chain took another step closer to going private. According to CNBC, the company was close to a deal with private equity firm Leonard Green, which would provide about $1 billion in equity to the founding Nordstrom family to help fund a takeover.
The family owns about 31% of the company today. The stock was up 6% as of 11:43 a.m. EDT on the news.
This isn't the first time that the stock has jumped on the possibility of going private as the family first announced back in June that it would explore ways to take the company private, including partnering with a private equity firm. Now, the family is talking to banks about raising $7 billion-$8 billion in debt, and could make a bid for the company within a few weeks.
The stock slipped in August when it seemed like Nordstrom wouldn't find a partner, but investor hopes seem to be high again after today's news.
Shareholders are bidding the stock higher as they're hopeful that a takeover would mean the company selling for a healthy premium. The Nordstrom family believes they could extract more value from the company if it were private where it can make changes without shareholder scrutiny.
The company has been outperforming its rivals as it was the only major department store chain to post a rise in comparable sales in the recent quarter. It also continues to invest in new stores like a flagship location in Manhattan set to open in 2019 and the expansion of its off-price rack concept.
Still, the outcome of the family's talks to take the company private should determine the direction of the stock over the short term.