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July 26, 2007

US: Nordstrom agrees US$210m Faconnable sale

US retailer Nordstrom is to sell its Faconnable apparel brand to Lebanon-based M1 Group (M1) for US$210m.

US retailer Nordstrom is to sell its Faconnable apparel brand to Lebanon-based M1 Group (M1) for US$210m.

M1 says it intends to grow Faconnable’s internationational presence, while Nordstrom will now be free to focus on its core US department stores.

All of Faconnable’s business will transfer to M1, including design, production, licensing, distribution and operation of the four US and 37 European Faconnable boutiques.

As part of the deal, Nordstrom will continue to buy Faconnable merchandise at “historical levels” for at least the next three years. Nordstrom bought Faconnable for $169m in 2000, and has sold the label in the US since 1989.

just-style reported earlier in the month (13 July) that Nordstrom was edging closer to the sale. The transaction, which is pending customary closing conditions, is expected to close at the end of August.

M1 is a family-owned company engaged in a number of diverse business activities including telecom, airlines, energy and real estate sectors. The company, which has been actively pursuing a luxury apparel and accessories brand, said that Faconnable has potential to become a global brand.

“We believe this transaction is in the best interest of our company, our shareholders, our customers and Faconnable,” said Blake Nordstrom, president of Nordstrom.

“The Faconnable brand has been very successful for Nordstrom. Over the last 19 years our company has played a pivotal role in the development and success of this unique line, which has become one of our top-selling brands.

“This move allows Nordstrom to focus on its core business while continuing to offer the Faconnable brand to our customers and allows Faconnable the opportunity to grow independently.”

US and Nice-based Faconnable employees will be offered positions by M1 following the close of the transaction, the companies said.

A number of US based Faconnable employees will remain with Nordstrom for approximately 12 months to provide transition services, and Nordstrom will be reimbursed during this period for the services provided.

Azmi Mikati, chief executive of M1 Group, said: “We are delighted to have acquired Faconnable. We believe it is a high potential brand and we intend to invest in it for the long term to break into new markets and new product lines.

“Faconnable represents for us the cornerstone in the development of our strategy aimed at investing in luxury products with a big potential for growth.

“To assist us in fulfilling this, we look forward to working with the existing management team based in Faconnable’s headquarters in Nice, in the South of France.”

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