Monday, 29 July 2013

News: HBC to acquire Saks in $2.9 Billion Deal

Hudson’s Bay Company confirmed this morning its intention to acquire Saks Incorporated (operated of Saks Fifth Avenue and its OFF 5TH outlets) for $16USD per share, approximately $2.9 billion. Combined HBC will operate 320 stores (179 full line department stores, 72 outlet stores, 69 home stores, and 3 e-commerce sites) under the Hudson’s Bay, Lord & Taylor, and Saks Fifth Avenue banners.

"This exciting portfolio of three iconic brands creates one of North America's premier fashion retailers," said Richard Baker, HBC's Chairman and CEO. "I've had a long connection with Saks over the years, and am thrilled to bring one of the world's most recognized luxury retailers into the HBC family. With the addition of Saks, HBC will offer consumers an unprecedented range of retailing categories and shopping experiences. This acquisition will increase our growth potential both in the U.S. and Canada, generate significant efficiencies of scale, add to our powerful real estate portfolio and deliver substantial value to our shareholders."

Once the deal is finalized, HBC will recognize significant cost savings and growth opportunities both in Canada and the United States. Saks will continued to be based and operated from it’s base in New York City, but a Canadian roll-out was confirmed for both Saks Fifth Avenue and OFF 5TH.

In a later media call, Baker stated his intention for an eventual seven full line Saks Fifth Avenue stores in Canada, and a further two dozen OFF 5TH locations. Some of these locations could be converted from current Hudson's Bay locations. This move comes as Nordstrom prepares to open its first Canadian store next year.

[Click here for the official press release.]