Saks Fifth Avenue, the fashion retailer based in the UK, may in all probability see its e-commerce firm file for initial public offering (IPO). At least that’s what some media reports are saying now.
Earlier this year, Saks’ owner HBC had split its physical stores from its e-commerce operations (saks.com) with a US $ 500 million infusion from private equity firm Insight Partners.
Back then sak.com was valued at US $ 2 billion. As per a report published in the Wall Street Journal, the planned IPO has a target of US $ 6 billion.
Separating e-commerce from stores is sometimes financially beneficial as a standalone e-commerce business is valued at a much higher multiple than the current business.
There haven’t been any comments from the retailer regarding the IPO so far.
Experts believe retail recovery to dwindle by next year and therefore both HBC and Insight Partners would be keen to go public while the going is good.
Founded in 1670, HBC is a Canadian retail business group and now owns and operates retail stores in Canada and the US.
