UNITED STATES – Hudson’s Bay Co has said that it has won shareholders’ approval to become a private company in a C$2 billion (about US$1.5 billion) deal proposed by Chairman Richard Baker.
According to Reuters, Baker and his partners had been in a tussle with the department store operator’s top shareholders over the deal.
The retail mogul fell short in an earlier vote to approve his take-private quest last year, Reuters reported, but later won the support of a significant shareholder after bumping the offer price to C$11 per share.
“Our reason for wanting to be private was so that we can focus our time and energy and dollars on re-investing in the business,” Baker said.
“We will be able to use our dollars to re-invest online and re-invest in product and in sales teams and in our stores, and I think that will put us in a better position to grow our business.”
The move comes as the retailer struggles to increase sales in a competitive market, forcing it to close shops and sell units to focus on luxury department store Saks Fifth Avenue and its Hudson’s Bay stores in Canada.
According to a company spokesperson, the deal was backed by 98.28% of all shareholders and 94.46% common shareholders.
In an earlier report, Reuters had noted that Saks Fifth Avenue will expand into bankrupt fashion chain Barneys’ Beverly Hills shop.
The move would give Saks three locations on Wilshire Boulevard: its men’s shop, a department store and the third spot in Barneys.
Baker said that the expansion is “a great example” of what Hudson’s Bay will be able to do as a privately held company.
The take-private deal, according to baker, will allow them to reallocate space and sales among the three buildings on the swanky strip “in order to maximize our offering, maximize our sales and maximize the value of the real estate.”
According to Reuters, Hudson’s Bay will also license the Barneys brand from its new owner, Authentic Brands Group LLC.
Baker believes that the Luxury space is ripe for consolidation and he believed that Hudson’s Bay was the “strongest player in the luxury space and a likely consolidator”.
The retail chain has in the past considered acquiring competitor Neiman Marcus Group Inc.
