HBC goes private; CEO steps down
As Canadian retailer Hudson’s Bay Company (HBC) announced on Tuesday that it has completed its privatization transaction, it was also revealed that CEO Helena Foulkes will be stepping down from her role, to be replaced by governor and executive chairman Richard Baker.
Baker, who led the group of shareholders that have now taken HBC private, will take over as CEO effective March 13, adding the role to his existing responsibilities at the company.
As he leads HBC in a new direction, the executive will be supported by the company’s senior leadership team, which includes Hudson’s Bay brand president Ian Nairn and Saks Off 5th president Paige Thomas, both of whom have been appointed to their positions in the space of the last two months.
Baker’s predecessor, Foulkes, joined HBC in February 2018. During her time as CEO, the CVS veteran worked to downsize the company, selling its Lord & Taylor brand to Le Tote in August of last year and cutting its European real estate assets loose.
“The company and I are grateful for Helena’s leadership and significant accomplishments over the last two years,” commented Baker in a release. “Together, we have simplified our company, strengthened retail operations and reinvigorated our focus on the customer. Each of our businesses is well positioned to take advantage of opportunities in their unique markets and we are optimistic about this exciting next chapter for our company.”
With the completion of HBC’s privatization transaction on Tuesday, Baker will now be looking to implement a number of new turnaround measures at the company without having to respond to shareholder pressure about growth and dividends.
“As current and future generations change the way they live, shop and work, we are committed to transforming HBC to capitalize on these shifts,” he explained on Tuesday. “It will take patient capital and a long-term view to fully unleash HBC’s potential at the intersection of real estate and retail.”
Having initially offered minority shareholders C$9.45 per share for their stakes in HBC in June of last year, the group led by Baker ultimately ended up paying C$11.00 per share to take the company private.
Most of the cash needed for the transaction was raised through the sale of HBC’s real estate and retail holdings in Germany.
Along with Baker, the group behind the go-private deal includes Rhône Capital LLC, WeWork Property Advisors, Hanover Investments (Luxembourg) S.A., and Abrams Capital Management LP.
HBC, which reported a third-quarter net loss of C$175 million on revenues of C$1.8 billion in December of last year, owns the Saks Fifth Avenue, Saks Off 5h and Hudson’s Bay brands, and also acquired the rights to the Barneys name under license following the retailer’s liquidation.
Common shares in HBC are expected to be delisted from the Toronto Stock Exchange at the close of trading on March 4, 2020.
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