(Reuters) - Hudson’s Bay Co (HBC.TO) said on Wednesday it would sell its Lord + Taylor department store business to fashion rental service company Le Tote Inc for about $100 million, as the retail operator culls its portfolio to a few key brands.
The retail company has been selling businesses and closing stores over the past few years to focus on luxury department store chain Saks Fifth Avenue and Hudson’s Bay in Canada to shore up its finances as shoppers skip brick-and-mortar stores to shop online instead.
Le Tote will pay Hudson’s Bay C$99.5 million ($74.95 million) in cash when the deal closes and another C$33.2 million in cash after two years. Hudson’s Bay will receive a 25 percent equity stake in Le Tote and two seats on the company’s board.
“It allows us to focus on Saks and its upside potential,” said Hudson’s Bay Chief Executive Helena Foulkes, adding that the company is simplifying and streamlining Hudson’s Bay in Canada.
The deal with Le Tote comes months after Hudson’s Bay Executive Chairman Richard Baker offered to take the Canadian retailer private in a C$1.74 billion deal.
A special committee of Hudson’s Bay’s board said Baker’s offer for the company was “inadequate,” while shareholders, who must approve the deal, have opposed it because it does not provide enough value.
Hudson’s Bay’s sale of the Lord + Taylor business is the latest of several divestitures. The retailer announced in 2017 it would sell Lord + Taylor’s Manhattan flagship to co-working space manager The We Company.
Earlier this year, Hudson’s Bay sold its remaining stake in its
