Hudson’s Bay Company has completed its acquisition of Galeria Holding, parent of German mega-department store chain Galeria Kaufhof and Belgium department store Galeria Inno, the company announced today.
The deal, valued at 2.5 billion euros, or $2.8 billion at current exchange rates, means HBC now operates eight banners, in four countries, and more than 464 locations including its Saks Fifth Avenue, Lord & Taylor, and Saks Off 5th in the U.S.
“This is a very exciting day in our 345 year history,” said Richard Baker, HBC’s governor and executive chairman, in a release. “Adding Galeria to the HBC family is a significant step forward in our international growth plans. The closing of these transactions demonstrates our proven growth formula in action: improving successful retail operations, unlocking the value of real estate and growing through acquisitions. Expanding our footprint into Europe also provides HBC with a strong foundation to explore additional growth prospects throughout the Continent.”
In conjunction with the closing of the acquisition, HBS Global Properties, HBC’s real estate joint venture with Simon Property Group, acquired 41 Galeria properties in a transaction valued at 2.6 billion euros, or $2.9 billion at current exchange rates.
“We believe that there are tremendous opportunities to grow the Kaufhof and Inno banners, and look forward to working with the existing management team to execute on our combined vision for the future of this business,” HBC CEO Jerry Storch, said in a statement. “This vision includes dramatic enhancements to the customer experience through the introduction of new brands, a focus on high-performing merchandise categories, substantial expansion of Kaufhof’s digital capabilities and, over time, introduction of Saks Fifth Avenue and Saks Off 5th into the German market.”
With the acquisition, HBC will add 21,500 Galeria employees to its team of 44,000 employees.
Meanwhile, HBC also announced Tuesday its plans to slash 265 jobs at its headquarters and in corporate offices across store banners in North America.
Management said the firm is engaged in a realignment of its North American operations that it expects to generate around $75 million in annual cost savings.