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Hudson’s Bay Company Files For Credit Protection in Canada March 11, 2025 (0 comments)
TORONTO, Canada--The Hudson’s Bay Company ULC, the Canadian department store chain that comprises the retailer Hudson’s Bay and TheBay.com, has commenced proceedings under the Companies’ Creditors Arrangement Act (CCAA) in an attempt to restructure.
The CCAA proceedings do not affect Saks Global, the U.S. entity that is a standalone entity distinct from Hudson’s Bay Company ULC.
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The CCAA is a Federal Act in Canada that allows financially troubled corporations the opportunity to restructure their affairs.
The initial order for creditor protection was issued from the Ontario Superior Court of Justice (Commercial List) (the Court). The court has appointed Alvarez & Marsal Canada Inc. as the monitor to oversee the CCAA proceedings.
Among other things, the Initial order provides for a stay of proceedings in favor of Hudson’s Bay and its subsidiaries for an initial period of 10 days, subject to extension thereafter if the court deems it appropriate. The stay of proceedings is also extended to Hudson’s Bay’s real estate joint venture with RioCan.
Restore Capital, LLC, an affiliate of Hilco Global, together with other lenders, has committed to provide interim debtor-in-possession financing to finance Hudson’s Bay’s operations in the lead up to the “comeback motion” hearing, with a CAD$16 million ($11 million) advance approved earlier today. Hudson’s Bay will be seeking additional financing to fund its operations during the CCAA proceedings.
Hudson’s Bay Company ULC is a Canadian entity that includes the retail company Hudson’s Bay, comprising 80 stores and TheBay.com. Through a licensing agreement, 3 Saks Fifth Avenue and 13 Saks OFF 5TH stores also operate in Canada under Hudson’s Bay Company ULC. All stores will continue to operate as normal during the CCAA proceedings.
“Hudson’s Bay has been a vital retailer to Canadians for generations, and this decision was made with the best interests of our customers, associates and partners in mind,” said Liz Rodbell, president and CEO of Hudson’s Bay. “While very difficult, this is a necessary step to strengthen our foundation and ensure that we remain a significant part of Canada’s retail landscape, despite the sector-wide challenges that have forced other retailers to exit the market. Now more than ever, it is critical that Canadian businesses are protected and positioned to succeed.”
Rodbell added, “Earlier this year, we worked with potential investors to refinance a portion of our credit facilities to improve our liquidity and support our business plan. However, the threat and realization of a trade war has created significant market uncertainty and has impacted our ability to complete these transactions.”
The company said it is exploring strategic alternatives and engaging stakeholders to explore potential solutions to preserve and strengthen its business. While no assurances can be provided, these discussions reflect Hudson’s Bay’s commitment to preserving jobs and community ties where possible.
Hudson’s Bay cited ongoing trade tensions with the U.S., particularly tariffs, post-Pandemic shifts resulting in work-from-home policies that resulted in less foot traffic in center city populations, and rising cost of living rates for Canadian citizens.
