Hudson’s Bay Co. said it is pursuing strategic alternatives for Lord & Taylor, including a possible sale or merger of the department-store chain.
Suzanne Kapner of The Wall Street Journal had the news:
The discussions center on the operating business, not the real estate, which includes about 45 stores along the East Coast, a person familiar with the situation said.
Separately, Hudson’s Bay Chairman Richard Baker has been sounding out landlords about buying back leases and also discussing plans to redevelop some sites without Lord & Taylor, according to people familiar with the matter.
Canada-based Hudson’s Bay, which also owns Saks Fifth Avenue, said Monday the review is part of a strategy to focus on its best opportunities. Last year, it sold half of its European operations, as well as the flash-sale site Gilt Groupe. In February, it said it would close its Home Outfitters business in Canada and as many as 20 Saks Off 5TH stores in the U.S.
“This review of strategic alternatives for Lord & Taylor is another example of how we are exploring options to position HBC for long-term success,” said Helena Foulkes, Hudson’s Bay’s chief executive.
Joseph Pisani of the Associated Press reported that Lord & Taylor has struggled to compete online:
Hudson’s Bay, which owns Lord & Taylor and Saks Fifth Avenue, said Monday that it hired a financial adviser to review Lord & Taylor’s business and that the process may lead to a sale or merger.
Lord & Taylor traces its origins to more than 190 years ago, when it was founded as a dry goods store in 1826. The store has had several owners. It was acquired by Hudson’s Bay Co. in 2012.
Lord & Taylor has struggled as more people shop online. Hudson’s Bay has closed some of its stores, including Lord & Taylor’s flagship store on New York’s Fifth Avenue, which was shut for good earlier this year after more than a century in the 11-story building. Last year, to attract new customers, Lord & Taylor started selling its brands on Walmart’s website.
Amelia Lucas of CNBC.com reported that parent Hudson Bay has been trying to simplify its organization:
Lord & Taylor’s parent company has been trying to simplify its organization, strengthen its retail operations and improve its cost structure.
“This review of strategic alternatives for Lord + Taylor is another example of how we are exploring options to position HBC for long-term success,” Hudson’s Bay CEO Helena Foulkes said in a statement.
Last month, Hudson’s Bay reported that fourth-quarter same-store sales for Lord & Taylor, Home Outfitters and its namesake brand declined by 5.2%. Its luxury department store brand Saks Fifth Avenue reported same-store sales growth of 3.9%.
The company announced Monday that it has retained PJ Solomon as its financial advisor for its review of the department store brand.
