A recent court filing indicates that Hudson's Bay, Canada's oldest retailer, has received 17 bids for its assets amid its ongoing creditor protection process. The report, filed by Alvarez & Marsal, a court monitoring firm, does not disclose the identities of the bidders but reveals that the offers came after outreach to 407 potential buyers.
Out of those 407 contact efforts, 54 potential buyers signed a non-disclosure agreement to access Hudson's Bay data, which was essential for determining the viability of their bids. However, less than half of those who signed ended up submitting formal offers. Currently, Hudson's Bay and the parties responsible for selecting a buyer are evaluating the received bids and engaging in discussions with those who submitted them.
Interestingly, the bidding process could result in multiple successful buyers, as interests vary significantly. Some bidders are keen on operating physical stores, while others are primarily interested in acquiring the intellectual property associated with Hudson's Bay. This includes not only its well-recognized multicolored Stripes motif but also brands such as Zellers, Gluckstein, Hudson North, and Distinctly Home.
Among the bidders, Weihong Liu, a mall owner from British Columbia, and Urbana Corp., a Toronto-based investment firm, have publicly disclosed their interests. Liu has expressed intentions to operate 25 Hudson's Bay stores, while Urbana Corp. aims solely to acquire intellectual property. Additionally, sources indicate that Canadian Tire is also interested in obtaining the intellectual property, although CEO Greg Hicks stated on a recent earnings call that acquiring the Bay's entire operations is not a suitable fit for Canadian Tire at this time.
At present, Hudson's Bay is also in the midst of another process seeking to offload the leases from its 80 stores and an additional 16 tied to Saks. A first round of bidding for these leases attracted interest from 18 unnamed parties who collectively sought 65 properties. After a second round, the field has been narrowed down to 12 potential bidders wanting a total of 39 leases, with some vying for the same locations. Notably, there have been no bids for 62 leases, and four properties have already been returned to their landlords.
As the 355-year-old retailer moves forward with sale processes, it is in the midst of liquidating all of its stores. The liquidation sales are set to continue until June 1. Following this, a two-week period will be allocated for individuals who purchased the company's furniture, fixtures, and equipment to collect their items. According to the latest court filing, around 90% of the inventory from distribution centers has been delivered to stores, with the remainder expected to arrive by May 16, except for a small portion of larger furniture items.
The court filing also provided insights into an upcoming auction of Hudson's Bay's extensive collection, which includes 4,400 pieces of art and artifacts, prominently featuring the royal charter that established the company. Several archival organizations and Indigenous groups have raised objections regarding these items potentially falling into private ownership. The report notes that some unnamed groups have had the opportunity to preview the art collection, while others can access a catalog by signing a non-disclosure agreement. Furthermore, much of the art and artifacts were donated to the Archives of Manitoba in 1993, meaning many historically and culturally significant items were out of the company’s possession prior to its creditor protection filing.
The recent court report sets the stage for Hudson's Bay's return to court on Tuesday, where it is anticipated the company will request an extension of its creditor protection from its current end date of May 15 to July 31. Alongside this, Hudson's Bay will seek court approval to repay up to $165 million to its senior lenders.
