Hudson’s Bay having ‘good’ talks with partners, awaiting approval to liquidate

Hudson’s Bay is still waiting to see if it will be granted approval to liquidate stores as the retailer requests more time to work out some of its differences with its myriad of landlords, lenders and other partners.

The department store giant was in court Wednesday, where its lawyers asked for up to two more days to resolve contested issues. During prior hearings, halting rent payments to RioCan Real Estate Investment Trust, which it holds property with through a joint venture, and other vendors were disputed.

Ashley Taylor, a lawyer representing Hudson’s Bay, told Ontario Superior Court judge Peter Osborne, “we have had good, constructive discussions,” but asked for more time to keep that dialogue going.

In the best-case scenario, Taylor expected the discussions will have netted enough consensus by Thursday, but he asked the judge to give the parties until Friday, if they need it.

The discussions are holding up the liquidation Hudson’s Bay had hoped to start this week at all 80 of its stores, as well as three Saks Fifth Avenue stores and 13 Saks Off 5th locations in Canada. The company filed for creditor protection on March 7.

Despite requesting permission from the court to move forward with the liquidation, the company is holding out hopes it can avoid the merchandise sell-off by finding enough financing to keep it alive in some form.

The $23 million it has garnered so far is not enough and necessitates a full liquidation of the business, putting 9,364 jobs at risk, lawyers for Canada’s oldest company have said.

Hudson’s Bay’s fortunes do not appear to have turned yet. When the company returns to court in the coming days, Taylor said he still expects to be asking for permission for Hudson’s Bay to carry out a full liquidation, but he said the business isn’t giving up.

“I can assure the court that management is doing everything they can in an effort to find a restructuring solution here,” Taylor said.

Osborne granted Hudson’s Bay the additional time Taylor asked for, saying it “minimizes the conflict but also the cost and maximizes the chance of recovery.” 

Before granting the added time, he sought assurances from Taylor that the company had the ability to keep operating until Friday with locations open and goods being shipped from the distribution centre to stores.

Taylor told him, “It’s business as usual.”