North American retailer Hudson’s Bay Company has initiated creditor protection proceedings under the Companies’ Creditors Arrangement Act (CCAA), a strategic move for recovery amidst Canadian retail challenges.
Hudson’s Bay has consulted with legal and financial advisors before making the decision public. Alvarez & Marsal Canada has been appointed by the court as the monitor for the proceedings.
The company points to ongoing trade disputes with the US, economic turbulence and changes in consumer behaviour post-pandemic as catalysts for the move.
The initial court order from the Ontario Superior Court of Justice offers Hudson’s Bay and its subsidiaries a protective stay of proceedings for ten days, with potential extensions at the court’s discretion. This stay also applies to Hudson’s Bay’s real estate joint venture with RioCan.
Restore Capital, a Hilco Global affiliate, along with other lenders, pledged interim debtor-in-possession financing to support Hudson’s Bay operations until the “comeback motion” hearing.
A C$16m advance was sanctioned in the first week of March 2025 and Hudson’s Bay is seeking additional funding to maintain operations throughout the CCAA process.
Hudson’s Bay president and CEO Liz Rodbell stated: “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.
“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 realisation of a trade war has created significant market uncertainty and has impacted our ability to complete these transactions.”
Hudson’s Bay is considering strategic options and is in talks with stakeholders to identify viable solutions to preserve and fortify its business.
While outcomes are uncertain, the discussions are said to demonstrate the company’s dedication to maintaining employment and community relationships where feasible.
The CCAA process will enable the company to streamline its operations and expenses while concentrating on its primary competencies.
The company operates Hudson’s Bay and TheBay.com, and holds licensing agreements for a selection of Canadian Saks Fifth Avenue and Saks Off 5th locations.
The licensing agreement ensures that both Canadian Saks Fifth Avenue and Saks Off 5th locations will continue their operations uninterrupted.
These proceedings do not involve US-Saks Global, which operates independently from Hudson’s Bay Company.
Recent developments follow Hudson’s Bay Company’s completion of the acquisition of Neiman Marcus Group, a US-based department store chain, for a total enterprise value of $2.7bn.
“Hudson’s Bay seeks creditor protection under CCAA for recovery ” was originally created and published by Retail Insight Network, a GlobalData owned brand.
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