The parent company of Canadian retailer Hudson’s Bay is buying Neiman Marcus Group in a US$2.65-billion deal that includes an investment from e-commerce giant Amazon.com Inc.
HBC L.P., which also owns Saks Fifth Avenue, announced the deal on Thursday, consolidating the luxury department stores at a time when consumers suffering under the weight of inflation and higher interest rates have been cutting back on non-essential purchases.
When the deal closes, HBC will establish a new company called Saks Global, combining Saks, Saks Off 5th, Neiman Marcus and Bergdorf Goodman. The company will hold the combined U.S.
real estate assets of HBC and Neiman Marcus Group, which are worth US$7-billion, according to the company. HBC operates 39 Saks Fifth Avenue stores across North America, and 95 Saks Off 5th locations; Neiman Marcus has 36 stores, as well as two Bergdorf Goodman locations and five discount Last Call stores. The Canadian retail operations will continue to operate separately from Saks Global as a wholly owned division of HBC, and will continue to hold the company’s Canadian real estate assets, which HBC says are worth $2-billion.
The deal will also recapitalize the Canadian business to reduce its leverage and provide “enhanced liquidity,” according to a press release on Thursday. The Canadian operations have been struggling, cutting hundreds of jobs since the beginning of last year and to some suppliers last fall. HBC is financing the deal with equity capital from .
