NRDC Equity Partners, which owns Lord & Taylor and Fortunoff's, may be getting ready to make a bid for Canada's Hudson's Bay Co. (HBC).
The two companies are not strangers to one another. NRDC currently owning a 20 percent stake in HBC along with a seat on its board of directors. HBC operates the Bay department store chain along with the Zeller's discount chain, Home Outfitters home décor business and Fields, a discounter that operates stores in rural areas.
The currently circulating rumors are not new with NRDC having said to be interested in acquiring HBC in full since the former owner, Jerry Zucker, died in April. Mr. Zucker and NRDC president and chief executive Richard Baker were said to be close friends.
Mr. Baker has spoken about opportunities to expand the Lord & Taylor and Fortunoff banners beyond the U.S. into Canada and elsewhere. There is some thought that under NRDC ownership some of the Bay stores would be converted to Lord & Taylor locations.
"I don't think you could find a better buyer for HBC," Anthony Stokan, principal at Anthony Russell and Associates, a shopping center consultancy, told the Financial Post. "NRDC has done an incredible job of revitalizing a very tired, old-world brand that had been struggling for two or three decades and that [situation] mirrors what Mr. Zucker was trying to do with HBC. [NRDC] was extremely methodical about which locations to shutter and relocate and how to rebrand Lord & Taylor for a much younger customer. In order for the department store category to see any uplift in the coming years we will see a radical change such as this."
Current HBC CEO Robert Johnston had no comment on the NRDC report.
An HBC spokesperson Hillary Marshall told the Financial Post, "Richard Baker and NRDC have been involved with HBC as minority owners and board members since 2006. Through their ownership of well-known properties such as Lord & Taylor and Fortunoff, they bring another layer of expertise to our organization."
Discussion Questions: First, have you been surprised by the way NRDC has taken to retailing? Do you think it is in the business with Lord & Taylor, Fortunoff and whatever comes next for the long haul? Secondly, what do you think of an NRDC acquisition of Hudson's Bay Co.? What do you think it would do with HBC?