A blockbuster deal in retail could be on the horizon. Or not.
Canada’s Hudson's Bay Company has approached Macy’s about a takeover, reported The Wall Street Journal, citing people familiar with the matter.
The talks between the companies are in the early stages and could lead to something other than an acquisition, according to the Journal, such as a deal for Macy’s real estate, which could be valued at roughly $14 billion. The talks could also go nowhere.
In addition to its namesake department store chain and Home Outfitters home décor business, Hudson’s Bay’s retail portfolio includes Saks Fifth Avenue and Lord & Taylor, and the 80-store Galeria Kaufhof in Germany. The company is headed up by veteran retailer Jerry Storch, the former CEO of Toys “R” Us.
Hudson's Bay would face some challenges in absorbing Macy’s. Before its stock spiked on news of the deal, Macy's market capitalization was nearly $10 billion, while Hudson's Bay was about $1.7 billion, CNBC said. Macy's also has a significant amount of debt about $7.5 billion, according to the Journal report.