Hudson’s Bay Receives Court Approval for $30-Million Canadian Tire Deal
Canadian Tire Corp. has received court approval for a $30-million deal to acquire Hudson’s Bay Co.’s intellectual property, paving the way for the transfer of a trove of the historic retailer’s brand names, logos, and stripe design dating back to the point blankets used in the fur trade in the 18th century. Ontario Superior Court Justice Peter Osborne approved the deal on Tuesday, calling it the “best outcome” for the retailer’s assets. The court hearing occurred just two days after Canada’s oldest retailer completed its liquidation sales, closing its doors for the final time over the weekend.
Ashley Taylor, a lawyer with Stikeman Elliott LLP representing Hudson’s Bay, told the court that there was no opposition to the Canadian Tire deal, which was reached after “a robust” sales process. Reflect Advisors LLC, the financial adviser handling that process, initially sent out materials related to the sale to 407 parties considered potential bidders and received a total of 17 bids.
Hudson’s Bay had been seeking a going-concern transaction to keep alive the operations of at least some of the stores. The company pitched a plan to potential buyers or investors, proposing a turnaround of six Bay stores that had initially been left out of liquidation, as well as the e-commerce operations, according to a confidential memorandum prepared by Hudson’s Bay in March.
The approval was slightly delayed on Tuesday, after Justice Osborne sought more details on the inclusion in the deal of trademarks related to the 1670 Royal Charter that gave Hudson’s Bay a trading monopoly over a wide swath of the land that is now Canada. The charter itself is part of a separate auction of the Hudson’s Bay art and artifacts collection, which has yet to occur.
Canadian Tire will be acquiring the Bay’s brand names, logos, and slogans, as well as private labels such as Distinctly Home and Hudson North. The deal is expected to close in the next two to three weeks.
On Tuesday, the court granted approval for thousands of Hudson’s Bay employees who have lost their jobs to seek support under the federal government’s Wage Earner Protection Program. The decision triggers an entitlement to federal benefits for the retailer’s former staff. Lawyers appointed to represent the Hudson’s Bay employees are now in discussions with Service Canada to develop a timeline for employees to access those federal benefits.
Source: Globe and Mail
Source: The Star
Hudson’s Bay to Close All Its Stores and Terminate 8,000 Employees on June 1
Canada experienced the largest wave of job losses since the closure of Sears Canada, with Hudson’s Bay closing all its stores on June 1. The 355-year-old company terminated about 8,340 employees, approximately 89 percent of its current workforce, when it completed the liquidation of more than 80 stores across the country. Another 899 employees will lose their jobs around June 15, with some 120 staying on to assist with the final wind-down of the retail giant. The last time Canada saw layoffs on this scale was in 2018, when Sears Canada shut down more than 100 stores nationwide, putting 12,000 people out of work and many facing deficits in their pension plans.
Hudson’s Bay has told employees they will not receive severance pay at the time of termination and has ended several benefits since the liquidation began, including pension payments to some former senior executives and post-retirement health and dental benefits for 2,000 retirees. The defined pension contribution and defined benefit pension for most of the retailer’s employees are sufficiently funded. Susan Ursel, whose law firm, Ursel Phillips Fellows Hopkinson, was appointed to represent Hudson Bay’s employees and retirees, said she feels very sad and is working very hard to find every means of alleviating their loss of employment.
The only piece of reassuring news for Hudson’s Bay employees is that the retailer is applying to the court to declare that it meets the criteria for the federal Wage Earner Protection Program (WEPP), which would trigger employees’ entitlements to benefits under the program. WEPP provides a one-time payment of up to seven weeks of insurable earnings, up to a maximum of $8,844, to employees whose former employer has filed for bankruptcy or protection under the CCAA. Unifor, which represents about 600 Hudson’s Bay employees, organized a rally to call on the federal government to reform the insolvency laws to better protect workers’ wages and benefits.
Source: The Star
Source: CTV News
Source: City News
Hudson’s Bay Reaches Deal To Sell up to 28 Leases to B.C. Mall Owner
Hudson’s Bay, Canada’s oldest company, plans to sell up to 28 of its store leases to a British Columbia mall owner, Ruby Liu, who wants to launch a new modern department store. Liu, who owns three B.C. malls, has promised to prioritize former Bay employees and suppliers and vendors when selecting partners for the business. The company filed for creditor protection in March and recently liquidated all of its stores.
Liu’s original plan was to “restore the Bay to its glory” by operating 25 of its stores. However, this plan hit a snag earlier in the month when Hudson’s Bay reached a $30 million deal with Canadian Tire for ownership of the Bay name, its stripes motif, its coat of arms, and several of its brands.
The agreement prevents Liu from turning any sites she is able to lease into Bay stores unless she comes to a licensing deal with Canadian Tire. Landlords may also stand in her way, as they were not part of the process that decided who to sell leases to and thus may argue they should have some say in who moves into their properties. They could also compel Liu to meet the same terms Hudson’s Bay and Saks agreed to, which may dictate the kind of business she can run in the spaces and even what hours it must be open.
Liu is a more familiar personality in B.C. and has some retail experience. She is the board chairwoman of Central Walk, a retail investment company that owns British Columbia malls Tsawwassen Mills, Mayfair Shopping Centre, and Woodgrove Centre, each housing Hudson’s Bay or Saks stores. She hasn’t said how she will fund the purchase of any leases, but the Woodgrove mall in Nanaimo was recently listed for sale through Colliers.
Liu also appears to have plenty of personal property to draw on for wealth. In a 2023 interview with Chinese media outlet 56 Below TV, she showed off an opulent West Vancouver home on a gated estate with a pool, home theatre, and a throne she said was a replica of the queen of England’s. She also owns the Vancouver Island golf course Arbutus Ridge.
With Liu on track to receive 28 leases, Hudson’s Bay still has plenty of properties available. Twelve parties made bids for a total of 39 leases, with some bidders making a play for the same locations. Hudson’s Bay remains in discussions with other bidders and will communicate the outcome of those discussions, as appropriate, in the future.
Source: Financial Post
Source: The Star
