U.S. activist investor Land & Buildings Investment Management LLC on Monday urged the management of Saks Fifth Avenue owner Hudson’s Bay Co to explore options including the sale of its real estate assets and taking the company private.
“With a modest market cap of US$1.2 billion, and insider ownership of about 20 per cent, a go-private transaction could be readily financed,” Land & Buildings founder Jonathan Litt said in a letter to HBC’s board of directors.
Land & Buildings, which owns a 4.3 per cent stake in Hudson’s Bay, said the Canadian department store operator’s real estate assets were worth $35 per share, nearly four times its current share price of $8.88.
HBC’s real estate portfolio includes its Saks Fifth Avenue flagship store in New York, valued at US$3.7 billion in 2014, and its Lord & Taylor flagship, valued at US$655 million in 2016.
The company’s shares hit a record low earlier this month after the company reported a bigger-than-expected quarterly loss.
HBC also said it would streamline its operations to better compete in a “brutal” market and also announced job cuts across North America.
© Thomson Reuters 2017