Founded in 1898 and with a history that stretches back to 1867, Saks Fifth Avenue is one of America’s oldest department stores. But it’s just been bought by a company even older.
That would be the Hudson’s Bay Company, which dates way back to 1670 to stand as the oldest company in Canada, the oldest commercial enterprise in North America and one of the oldest corporations in the world. Once the world’s largest landowner and the de facto government in parts of the New World that had yet to be colonized, HBC is today growing into one of its largest retailers.
Having essentially merged with Lord & Taylor (founded 1826) five years ago, the Hudson’s Bay Company recently signed an agreement with Saks Incorporated to buy the chain for $16 per share in a deal worth $2.9 billion – a far cry from the pelts and point blankets with which the company started trading over three hundred years ago. With a combined empire incorporating 320 stores across North America – including 179 department stores, 72 outlets and 69 homeware stores – the merger stands to make HBC one of the largest retailers in the world. At the same time, it gives the unified chain a larger foothold in the upscale market, dominated in the US by Nordstrom and in Canada by Holt Renfrew.
“This exciting portfolio of three iconic brands creates one of North America’s premier fashion retailers,” said HBC chairman Richard Baker. “I’ve had a long connection with Saks over the years, and am thrilled to bring one of the world’s most recognized luxury retailers into the HBC family. With the addition of Saks, HBC will offer consumers an unprecedented range of retailing categories and shopping experiences. This acquisition will increase our growth potential both in the U.S. and Canada, generate significant efficiencies of scale, add to our powerful real estate portfolio and deliver substantial value to our shareholders.” The deal is still pending regulatory approval as well as the termination of a 40-day “go shop” period in which Saks can entertain alternative proposals. Once completed, however, the merger stands to save the two companies an estimated $100 million in synergies within three years and, on the basis of its combined real estate portfolio alone, will make HBC the owner of some of the best retail locations across the continent.
