NEW YORK (Reuters) - Canadian retail operator Hudson’s Bay Co said on Monday that it was pursuing strategic alternatives such as a sale or merger for its department store Lord + Taylor, which has struggled to attract shoppers.
Lord + Taylor, founded in 1826 and the oldest U.S. department store, has seen its fortunes fall while Hudson’s Bay’s luxury department store Saks Fifth Avenue has managed to increase sales.
Brick-and-mortar retailers like Lord + Taylor have faced hard times as online shopping on sites including Amazon.com Inc gains popularity. Retailer Walmart announced last year that it would offer a Lord + Taylor flagship store on its website.
Hudson’s Bay said in a prepared statement that its plans to find a buyer for Lord + Taylor is part of efforts to focus on its “greatest opportunities.”
“Over the last year, we’ve taken bold actions and made fundamental fixes that have resulted in a far stronger, more capable (Hudson’s Bay), having returned to positive operating cash flow, increased profitability and strengthened the balance sheet,” Hudson’s Bay Chief Executive Helena Foulkes said in a press release.
Co-working space landlord WeWork Cos bought Lord + Taylor’s flagship on Fifth Avenue in New York City for $850 million two years ago. Hudson’s Bay has already announced plans to close up to 10 Lord + Taylor locations. The chain had 45 stores as of Feb. 2 and three outlet shops.
Earlier this year, Hudson’s Bay opened a renovated main floor at the Saks Fifth Avenue flagship in New York.
Last year, Hudson’s Bay was trying to revive Lord + Taylor’s fortunes, Reuters reported. One option it had considered was buying retailer Bon-Ton Stores Inc, which had filed for bankruptcy, and merging it with the chain.
A sale was a possibility at the time, but was considered unlikely given that there were few potential buyers who would pay top dollar, Reuters reported, citing sources familiar with the matter.
Hudson’s Bay has retained PJ SOLOMON as its financial adviser for the review of the Lord + Taylor business, the company said.
Reporting by Harry Brumpton and Jessica DiNapoli in New York, Editing by Susan Thomas and Tom Brown