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Nordstrom eyes e-commerce add-on

by Richard Collings | Published June 15, 2012 at 7:00 AM

More than a year after it bought shopping website HauteLook Inc., Nordstrom Inc. is considering another acquisition in the e-commerce space.

Nordstrom does not have a history of making acquisitions, but CFO Mike Koppel told The Daily Deal that the high-end department store chain doesn't "claim to have all the answers when it comes to e-commerce."

Koppel declined to say which assets the retailer might be targeting, only that they would be in the e-commerce sector.

He made the comments following a presentation at the Piper Jaffray 32nd Annual Consumer Conference, held June 5 and 6 at the Parker Meridien hotel in New York.

Seattle-based Nordstrom acquired members-only shopping website HauteLook for up to $270 million in stock in February 2011, the first time a traditional retail store operator has acquired a private "flash" sale site, which tends to offer high-end goods through quick sales.

At the time, the fashion chain said the purchase would enable an expansion of its online platform and provide an entry into the online private-sale marketplace.

One e-commerce industry executive who requested anonymity said that if Nordstrom were to target any of the dominant players, it would have to shell out at least a few hundred million dollars, although there may be less developed startups with interesting technologies that could be attractive to Nordstrom and less expensive.

There's a need for data-driven technology among brick-and-mortar retailers such as Nordstrom in order to track things like total demand, product waiting lists and clicks, and the number of goods that would have sold had supply not run out, the executive said.

It's the sort of technology that is spurring some degree of dealmaking in the sector, he added.

In April 2010 Cie. Financière Richemont SA acquired U.K.-based Net-a-Porter Ltd., valuing the e-tailer at close to $522 million. In March 2011, eBay Inc. announced it had agreed to buy Rue La La parent GSI Commerce Inc. for $2.4 billion.

EBay subsequently spun off Boston-based Rue La La to holding company Kynetic and loaned it $467 million as part of the acquisition of GSI Commerce, according to TechCrunch.

Fanatics Inc., a Jacksonville, Fla., operator of websites that sell sports-related memorabilia and products, is also a unit of Kynetic. It was acquired by GSI Commerce before the eBay deal for $277 million in cash, in February 2011.

A number of providers are now weighing initial public offerings. These include Ideeli Inc. and Gilt Groupe Inc., although Ideeli indicated it may also be open to an acquisition, as previously reported by The Daily Deal.

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