Hudson’s Bay Company faces liquidation

Hudson’s Bay Company is seeking court approval to liquidate.

Hudson’s Bay Company is seeking court approval to begin a liquidation of its business.

In court filings, Canada’s oldest retail company said that despite “exhaustive” efforts it was unable to secure adequate funds needed to facilitate a restructuring transaction under the Companies’ Creditors Arrangement Act (CCAA). It only obtained limited debtor-in-possession financing, with the financing not enough to avoid a full liquidation its business. A store-by-store liquidation process will begin as soon as next week barring any last minute solutions.

During the liquidation process, Hudson’s Bay and its licensed Canadian Saks Fifth Avenue and Saks Off 5th stores will remain open.

The retailer said it remains hopeful that key stakeholders, particularly its landlord partners, will engage to explore a viable alternative restructuring path that could preserve jobs and tenancy in retail locations.

Earlier this month, Hudson’s Bay started proceedings under the CCAA pursuant to an initial order for creditor protection from the Ontario Superior Court of Justice, citing trade tensions with the U.S., economic headwinds and post-pandemic consumer shifts. (The move is akin to a Chapter 11 bankruptcy filing in the U.S.)