Hudson’s Bay to liquidate entire business unless last-minute solution found

The chain says it has been forced toward a full liquidation because exhaustive efforts haven’t turned up the financing the company needs to restructure

TORONTO — Canada’s oldest company Hudson’s Bay says it will begin liquidating its entire business as soon as next week unless it finds a more viable path forward.

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The department store chain with 80 stores says it has been forced toward a full liquidation because exhaustive efforts haven’t turned up the financing the company needs to restructure.

Hudson’s Bay says it remains hopeful that it can drum up capital and find a solution with stakeholders including its landlord partners to avoid a full shutdown.

A closure of the entire business would mean job losses for 9,364 employees the company has in Canada across its Hudson’s Bay stores, as well as three Saks Fifth Avenue stores and 13 Saks Off 5th locations it owns through a licensing agreement.

The liquidation news comes roughly a week after the beleaguered company sought creditor protection from the Ontario Superior Court of Justice.

In its application, Hudson’s Bay said it was facing financial struggles because of subdued consumer spending, trade tensions between the U.S. and Canada, and post-pandemic drops in downtown store traffic.

The chain announced March 7 it was seeking creditor protection. At the time, Jennifer Bewley, the chief financial officer for Hudson’s Bay’s parent company, said in an affidavit filed in court that the business is having trouble making payments to landlords, service providers and vendors and had to defer certain payments for months.

“Without the benefit of court protection, failure by Hudson’s Bay to pay rent at its stores will result in a rapidly escalating chain of events, leading to lease defaults,” she said.

More to come.

With files from Sarah Grochowski