The knee of death is ringing for Canada’s oldest company.
Hudson Bay announced Friday night that it will start liquidating the entire business next week, putting more than 9,000 jobs in danger unless a more viable path is found.
The department store chain dates back to 1670 and now spans 80 stores, the company was forced to undergo a full liquidation because the “exhaustive” efforts did not receive the financing raised, i.e., to maintain at least a part of its empire.
The entire business closure, scheduled to take place ahead of a court appearance on Monday, means the company has lost work for 9,364 employees in the Hudson Bay store, as well as the Fifth Avenue store owned by a licensing agreement and three SAKS Fifth Avenue stores at the fifth location.
Although things seem bleak, the company holds hope for Hail Mary. It says it can inspire capital and find solutions with key stakeholders, especially their landlord partners, to avoid a complete shutdown, which remains optimistic.
“Our team worked very hard to identify a viable path and our determination has been overwhelmingly supported by clients and colleagues who shared heartfelt stories about Hudson Bay and what our store means to them, their families and generations.”
“These powerful experiences remind us why we must continue to seek every possible opportunity to ensure the necessary support of major landlords and other stakeholders to save the Bay.”
Gulf owes creditors nearly $1 billion
The company’s request for help was about a week later in the financial struggle. Creditor protection application It was produced by the Ontario Superior Court
Hudson Bay said in its app it is facing a financial struggle due to soft consumer spending, trade tensions between the U.S. and Canada and a massive decline in downtown store traffic.
The company owes more than $950 million to 26 pages of listed creditors: landlords, suppliers and other partners, including fashion heavyweights Ralph Lauren, Chanel, Chanel, Chanel, Columbia Sportswear, Diesel, Diesel and Estée Lauder, the filing shows.
Hudson Bay parent company chief financial officer Jennifer Bewley said in a March 7 court filing that the company had to postpone certain payments to such companies for several months because it had a lot of difficulties paying for landlords, service providers and suppliers.
The situation is so serious that she said the landlord “illegally locked” Hudson’s Bay from a store in Sydney, North Carolina, where a team of bailiffs tried to grab merchandise from another location it operated at the suburban Toronto mall Sherway Gardens.
The March 7 application is not to be a pioneer in closing the business, as Hudson Bay is designed to keep the company alive and operate as much as it can.
A week later, the company found itself in a more terrifying state. It said that store-by-store liquidation is necessary because it only receives “limited” debtor financing – a kind of capital firm that can seek restructuring purposes after making creditor protection documents.
Hudson’s Bay laid the foundation for its luxury division Neiman Marcus and Bergdorf Goodman when it moved its location to a separate entity.
Shopping malls at risk of losing anchor tenants
The full liquidation in Canada will not only put a large part of the country’s retail labor force into unemployment, but will also leave anchorage real estate to be filled in at anchor tenants in shopping malls and at Prestige Real Estate in high-traffic shopping districts.
Hudson’s Bay usually contains several floors in its locations, and is more square feet than other retailer businesses.
Most of the company’s stores are in Ontario, where there are 32 locations and more than half of the employees work. There are 16 people in BC, Alberta and Quebec, respectively, and two in each province.
The Canadian ruins on Fifth Avenue of Saxophone are divided into Ontario and Alberta, while Saks of Alberta owns stores in Ontario, British Columbia, Alberta, Quebec and Manitoba.
Although the company’s coast-to-coast footprint and its 17th-century fur trade origins make it a typical part of the Canadian structure, it has been led by Americans for decades.
Richard Baker, the national real estate and development company of the United States real estate owner. The equity partner purchased Hudson Bay from the legacy of late South Carolina businessman Jerry Zucker in 2008 for $1.1 billion.
Baker, who took the company public in 2012 and then privatized it again to acquire a bid, must receive two rewards in the weeks before Canada suffered from the Covid-19-19 pandemic lockdown to get shareholder approval.
It’s hard for shareholders to relax, partly because Baker hosted HBC when the stock fell, but many believe the company still holds a huge value in its real estate.
When he gained recognition, he acknowledged that the brand had a job to do.
“Put patient capital and long-term perspectives to fully unlock HBC’s potential for converging real estate and retail,” he said in March 2020.
The closures of a handful of stores and fragmented layoffs over the past two years show that potential is not easy as Canadian department store rival Simon and online giants such as Amazon have swallowed up sales.
