TORONTO – Hudson’s Bay Co. could be bulking up even more.
Would Hudson’s Bay Co’s US$250-million Gilt trip be well worth the price?
Reports that Hudson’s Bay Co. is looking to purchase online “flash-sale” retailer Gilt.com for US$250 million had some in the market questioning why the Toronto department store chain may wish to get a Web retailer whose estimated value had slid from US$1-billion four years ago.
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The Toronto-based owner of Saks Fifth Ave. and Lord & Taylor is in the running to purchase bankrupt department store chain V&D of the Netherlands, according to multiple Dutch media reports.
Several recent surveys within the Dutch media, citing sources near to the negotiations, say HBC governor Richard Baker is squaring off for the stores against Dutch retail and real estate investor Roland Kahn of Cool Investments, owner of the Netherlands-based retail chains CoolCat, M & S Mode, America Today and the lingerie brand Sapph.
“Many landlords are charmed by (HBC’s) serious curiosity about a considerable area of the V&D buildings,” says a translated report from the publication AD.
“The problem is that both (Kahn) and HBC want only a area of the V&D buildings, especially those in large cities. Most owners, however, have buildings both in large and small municipalities.”
HBC didn’t confirm or deny the reports when reached for comment Wednesday. “It is company policy to not comment on rumour or speculation,” HBC spokeswoman Tiffany Bourr said in an email.
Such a deal would be the second this year for HBC, which has executed a number of savvy property acquisitions to develop and diversify its real estate and store network, which it is also expanding organically.
Last month, HBC announced its US$250-million purchase of online retailer Gilt.com, a “flash-sale” site that it’ll use to blend using its network of off-price stores and enhance the company’s mobile shopping capabilities.
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In September, HBC closed its $3.8-billion purchase of German department store chain Galeria Kaufhof, with 102 locations in Germany and 16 under the banner Galeria Inno in Belgium. Following a completion of the Galeria acquisition last September, HBC said it now generated most its sales externally of the us.
“We believe that there are tremendous possibilities to grow the Kaufhof and Inno banners, and appear forward to working with the existing management team to complete on our combined vision for future years of this business,” Jerry Storch, HBC’s CEO, said at that time. “This vision includes dramatic enhancements towards the customer experience with the introduction of new brands, a focus on high-performing merchandise categories, substantial growth of Kaufhof’s digital capabilities and, with time, introduction of Saks Fifth Avenue and Saks Off Fifth into the German market.”
This week, the Dutch publication Quote, citing sources close to Kaufhof, said insiders expect HBC will renovate V&D’s buildings in order to make method for its very own stores, giving the Canadian retailer a good foothold into the Netherlands. The German chain has strong similarities with V&D, according to Quote.
Netherlands-based publication NRC said V&D’s bankruptcy trustees will asses the plans of the very most promising candidates next week.
Next week also marks the grand opening date for that first Saks Fifth Avenue store in Canada, adjacent to the flagship Hudson’s Bay store in downtown Toronto.
Financial Post
hshaw@nationalpost.com
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