Hudson's Bay Co., Canada’s oldest company, is buying American department store chain Neiman Marcus for $2.65 billion U.S.
Both companies are privately held and their stock does not trade on a public exchange.
The acquisition will result in a new company called “Saks Global” that will include retailers Saks Fifth Avenue, Saks OFF 5TH, the Neiman Marcus department store chain, and Bergdorf Goodman.
The retailers that will be apart of the new Saks Global company each sell designer clothing, accessories and housewares.
Hudson’s Bay has owned Saks Fifth Avenue and Saks Off 5th since 2013 and will now combine those retailers with Neiman Marcus and Bergdorf Goodman under the new Saks Global banner.
Saks.com chief executive officer (CEO) Marc Metrick will take the helm of Saks Global once the deal is finalized and the new company established.
The deal comes at a difficult time for traditional brick-and-mortar retailers, particularly department store chains.
The pandemic decimated the sector as department stores were forced to close or operate at reduced capacity and consumers pivoted to shopping almost exclusively online.
Following the pandemic, department stores have struggled to attract younger shoppers amid a pullback in discretionary spending and as people prioritize experiences over goods.
The result has been that Neiman Marcus filed for bankruptcy protection from its creditors in May 2020 before restructuring and carrying on as a standalone concern.
Hudson’s Bay Co., commonly known as “HBC,” has fired staff and sold off much of its real estate in recent years as it too has struggled financially.
The acquisition of Neiman Marcus is subject to regulatory approval in the U.S. and Canada. Once finalized, Saks Global will control $7 billion U.S. in real estate assets owned by HBC’s U.S. division.
In Canada, HBC will continue to wholly own its Canadian retail and real estate assets, including its trademark Hudson’s Bay outlets and a real estate portfolio valued at about $2 billion.
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