TORONTO & NEW YORK–(BUSINESS WIRE)–HBC (TSX: HBC) announced that its Board of Directors has formed a
Special Committee of independent directors to review the June 10, 2019
proposal from a group of HBC shareholders for the privatization of the
Company at a price of C$9.45 per share, payable in cash.
The group of HBC shareholders submitting the proposal includes
individuals and entities related to, or affiliated with, Richard A.
Baker, Governor and Executive Chairman of HBC; Rhône Capital L.L.C.;
WeWork Property Advisors; Hanover Investments (Luxembourg) S.A.; and
Abrams Capital Management, L.P., collectively called the Continuing
Shareholders. The group disclosed that they collectively own
approximately 57% of the outstanding common shares of HBC on an
as-converted basis.
The Special Committee of independent directors is composed of David
Leith (chair of the Special Committee), Stephanie Coyles, Wayne Pommen,
Earl Rotman and Matthew Rubel. The Special Committee has retained Blake,
Cassels & Graydon LLP as legal counsel and J.P. Morgan Securities as
financial advisor to assist in its review. The Special Committee will
oversee the preparation of a formal valuation by an additional
independent valuator regarding the proposed privatization transaction.
The proposed transaction from the Continuing Shareholders represents a
premium of 48% to HBC’s closing share price on the Toronto Stock
Exchange on June 7, 2019 and a premium of 39% to its 20-day average
closing price.
The Special Committee noted that no decision has been made and it
intends to carefully and thoroughly review the proposal with the
assistance of its outside financial and legal advisors. There can be no
assurance that any definitive agreement will be executed or that the
proposed transaction will be approved or consummated. HBC noted that the
Continuing Shareholders have advised the Company that they are not
interested in an alternative transaction that would result in the sale
of the Continuing Shareholders’ interest in HBC or the acquisition by a
third party of HBC or any of its material assets.
HBC does not intend to comment on or disclose further developments
regarding the Special Committee’s evaluation unless and until it deems
further disclosure is appropriate or required.
Forward-Looking Statements
Certain statements made in this news release are forward-looking
statements within the meaning of applicable securities laws, including,
but not limited to, statements with respect to: the take-private
proposal received by the Company from the Continuing Shareholders,
including the terms and conditions of the proposal; the review and
evaluation of the take-private proposal by the Special Committee with
the assistance of its outside financial and legal advisors; and other
statements that are not material facts. Often but not always,
forward-looking statements can be identified by the use of
forward-looking terminology such as “may”, “will”, “expect”, “believe”,
“estimate”, “plan”, “could”, “should”, “would”, “outlook”, “forecast”,
“anticipate”, “foresee”, “continue” or the negative of these terms or
variations of them or similar terminology.
Although HBC believes that the forward-looking statements in this news
release are based on information and assumptions that are current,
reasonable and complete, these statements are by their nature subject to
a number of factors that could cause actual results to differ materially
from management’s expectations and plans as set forth in such
forward-looking statements, including, without limitation, the following
factors, many of which are beyond HBC’s control and the effects of which
can be difficult to predict: (a) the possibility that the Company, its
Board of Directors, its Special Committee and the Continuing
Shareholders cannot come to an agreement on the terms and conditions of
the take-private proposal or will not proceed with giving shareholders
an opportunity to accept or vote in favour of the take-private proposal;
(b) the possibility that the terms and conditions of any definitive
agreement in respect of a take-private proposal will differ from those
that are currently contemplated; (c) if a definitive agreement is
reached, the failure to obtain or satisfy, in a timely manner or
otherwise, required shareholder and regulatory approvals and other
conditions of closing necessary to complete any take-private proposal;
(d) credit, market, currency, operational, real estate, liquidity and
funding risks generally, including changes in economic conditions,
interest rates or tax rates; (e) risks and uncertainties relating to
information management, technology, supply chain, product safety,
changes in law, competition, seasonality, commodity price and business
and (f) other risks inherent to the Company’s business and/or factors
beyond its control which could have a material adverse effect on the
Company or the ability to consummate the take-private proposal.
HBC cautions that the foregoing list of important factors and
assumptions is not exhaustive and other factors could also adversely
affect its results. For more information on the risks, uncertainties and
assumptions that could cause HBC’s actual results to differ from current
expectations, please refer to the “Risk Factors” section of HBC’s Annual
Information Form dated May 3, 2019 as well as HBC’s other public
filings, available at www.sedar.com
and at www.hbc.com.
The forward-looking statements contained in this news release describe
HBC’s expectations at the date of this news release and, accordingly,
are subject to change after such date. Except as may be required by
applicable Canadian securities laws, HBC does not undertake any
obligation to update or revise any forward-looking statements contained
in this news release, whether as a result of new information, future
events or otherwise. Readers are cautioned not to place undue reliance
on these forward-looking statements.
About HBC
HBC is a diversified retailer focused on driving the performance of high
quality stores and their omni-channel platforms and unlocking the value
of real estate holdings. Founded in 1670, HBC is the oldest company in
North America. HBC’s portfolio today includes formats ranging from
luxury to premium department stores to off price fashion shopping
destinations, with more than 300 stores and about 40,000 employees
around the world. HBC’s leading businesses across North America include
Saks Fifth Avenue, Hudson’s Bay, Lord + Taylor, and Saks OFF 5TH.
HBC also has significant investments in joint ventures. It has partnered
with Simon Property Group Inc. in the HBS Global Properties Joint
Venture, which owns properties in the United States. In Canada, it has
partnered with RioCan Real Estate Investment Trust in the RioCan-HBC
Joint Venture. HBC has partnered with SIGNA Retail Holdings for real
estate and retail joint ventures in Europe.
Contacts
Investor Relations:
Jennifer Bewley, 646-802-4631
[email protected]
Media:
Andrew Blecher, 646-802-4030
[email protected]
