Hudson’s Bay in German bid
Hudson’s Bay, the Canadian parent of US luxury department store chains Saks and Lord & Taylor, is running the ruler over Germany’s Kaufhof chain.
According to Canadian news reports, HB may pay as much as US$2.6 billion for the German business, which is more than it spent on acquiring Saks in 2013.
Kaufhof is currently owned by Germany’s Metro AG, whose primary focus is on its discount hypermarket business and electronics. It owns about 60 buildings across Germany housing its stores, part of a network of 105 department stores, 17 sportsgoods stores branded Sportarena and Wanderzeit, and 15 Galeria Inno stores..
Neither party has officially commented on the negotiations, news of which first broke on the trade industry website Women’s Wear Daily.
HB is known to be keen to expand its global footprint beyond North America. It paid $2.4 billion for Saks and has since released significant cash reserves by liquidating property assets.
HB’s governor and executive chairman Richard Baker has previously talked up the company’s appetite for expansion.
“Our criteria is to acquire companies that provide us with synergies – so cost savings. [Secondly], to provide us an opportunity to operate the business maybe better than the existing management operated it. And thirdly is to have some sort of a real estate component.
“We have the capacity and the financial capability to do a transaction at this time but we’re very picky and very careful and relatively slow and conservative on acquisitions,” he told an analysts conference call earlier this year.
Last financial year, Kaufhof reported pre-tax earnings of €193 million on sales of €3.1-billion.