Hudson’s Bay group to consider shelving takeover offer

Scott Deveau & Sandrine Rastello

BLOOMBERG – Hudson’s Bay Chairman Richard Baker may scrap an offer to take the struggling retailer private after regulators delayed a vote on the deal following complaints from a minority shareholder.

The investor group that controls the owner of Saks Fifth Avenue is “evaluating next steps, including terminating the transaction”, according to a memo sent to advisers. The group plans to make a final decision in a week or so, according to the note. Until then, it’s “pens down” until further notice, meaning no work is to be done on the deal.

The Baker group cited third-quarter results and a delay in the shareholder vote ordered by the Ontario Securities Commission late Friday. The Canadian regulator endorsed a complaint by minority shareholder Catalyst Capital Group, which had sought a delay and increased disclosure on the Baker bid. The vote is scheduled for today on the CAD10.30 a share offer that valued the Toronto-based company at CAD1.9 billion (USD1.4 billion).

The decision to consider scrapping the offer comes after preliminary tallies showed the Baker group had fallen short of the necessary support from investors to proceed with the transaction, according to people familiar with the matter. The bid required the backing of a majority of the minority shareholders.

A representative for Hudson’s Bay wasn’t immediately available for comment.