Latest news with #HBC
Yahoo
15-07-2025
- Business
- Yahoo
Court decision on sale of 25 Hudson's Bay leases delayed as buyer appears without a lawyer
Ruby Liu, the British Columbia-based billionaire who wants to buy 25 leases from Hudson's Bay Co., was in court Tuesday to face concerns that her plans for the properties are not sustainable, but the hearing was adjourned because she showed up without a lawyer to make her case. Judge Peter Osborne said he is concerned about the additional costs — $4.7 million per month — that HBC and its lenders will have to incur as a result of the delay in completing the sale, but the significance of the decision requires that she elaborate on her plans so that all parties are aware of them. 'I not only urge you, but recommend in the strongest possible terms that these parties retain counsel immediately and they be made aware of the urgency of this situation,' he said. A lawyer representing Restore Capital LLC, the HBC lender that brought forth the motion to terminate the deal between the defunct retailer and Liu, said the delay was not good. 'The purchaser is a sophisticated party … and I wouldn't think it would be possible to simply delay and increase costs by terminating a law firm,' Linc Rogers said. 'That would be a wrong incentive to provide for participants in this proceeding.' Liu said she is ready to 'hire people, create jobs' and 'open stores,' and that she would hire legal counsel as soon as possible. 'We will work closely with HBC, and we have already hired experts,' she said. 'We submitted business plans on May 1, and then continually updated the business plans. We have done tremendous work.' Ashley Taylor, a lawyer representing HBC, said there has been ongoing dialogue and work with Liu to try to answer some of the landlords' questions and inquiries. But lawyers representing the landlords didn't share Taylor's optimism. One of them said that there has been 'zero discussion' with the landlord he represents, though Liu may have had internal discussions with HBC and other lenders. Alex Hennick, who heads A.D. Hennick & Associates Inc., a law firm that provides liquidation solutions and is not part of the HBC hearing, said it was evident that the landlords don't want to lease to someone they don't have the confidence is going to be there long term. 'They don't believe that the model is going to work in the existing locations because it didn't exist for a historic retailer who was there for so many years,' he said. 'It's a very unique situation. It's not common. The reason it is being blocked is because no one really believes it could be a successful venture.' Canada's oldest department store filed for bankruptcy protection under the Companies' Creditors Arrangement Act on March 7. It has been selling its leases, intellectual property rights and artifacts since then and cut its workforce to pay back its creditors ever since. Hudson's Bay fights back against lender that wants to terminate lease sales to Ruby Liu Why the demise of Canadian retail's 'middle class' won't end with Hudson's Bay The retailer inked an agreement to sell up to 28 leases in Ontario, Alberta and British Columbia to Liu's Tsawwassen, B.C.-based company, Central Walk, on May 23. An Ontario court approved the sale of three of those leases, but the remaining 25 have yet to be approved. • Email: nkarim@
Globe and Mail
09-07-2025
- Business
- Globe and Mail
Hudson's Bay lenders file motion to terminate Ruby Liu lease deal
Some of Hudson's Bay Co.'s senior lenders are asking the court to terminate a contentious deal to sell off store leases to B.C. billionaire Weihong (Ruby) Liu, arguing that landlord opposition means the deal is unlikely to succeed and is wasting cash that should be used to repay the company's debts. The new court documents, filed on Tuesday, are also seeking a 'super monitor' to take over the operations of the failed retailer, saying Hudson's Bay has mismanaged the wind-down of the business to the detriment of its lenders. ReStore Capital LLC, the agent for a syndicate of senior lenders to Hudson's Bay, filed the motion seeking a court hearing next week into the matter. ReStore is an investment firm whose parent, Hilco Global, also owns the company that ran Hudson's Bay liquidation sales. On behalf of the syndicate of lenders, ReStore closed a $151-million term loan with Hudson's Bay last December, to assist with the company's 'urgent working capital needs' and to enable its parent company, HBC LP, to close its acquisition of Neiman Marcus Group in the U.S. As part of that transaction, Canada's oldest retailer was hived off from a new entity, Saks Global, which owns Neiman Marcus as well as Saks Fifth Avenue, Saks Off Fifth and Bergdorf Goodman. Ruby Liu gets keys to former Hudson's Bay-owned store as she looks to acquire more leases Opinion: Hudson's Bay was a 'zombie firm.' Canada is full of them and they all need to die Some of that loan to Hudson's Bay has already been repaid. For example, $27.7-million in proceeds from the $30-million deal to sell Hudson's Bay's intellectual property to Canadian Tire went to the syndicate of lenders, according to the court filing. But ReStore argued that Hudson's Bay has incurred unnecessary costs as it winds down its business, and 'frittered away' the pool of cash available to make further payments on its debts. Hudson's Bay, faced with mounting losses and $1.1-billion in total debt, filed for court protection from its creditors on March 7. Since then, failing to find a plan to rescue some of its stores, Hudson's Bay closed all of its locations across the country last month. ReStore cites as an example of mismanagement the deal that Hudson's Bay struck with Ms. Liu, a B.C. mall owner, in late May to assign her up to 28 of its store leases. The court has approved the assignment of three of those leases, which are owned by her company, Central Walk. But the majority of landlords for the remaining leases have opposed the deal. As a result of the impasse, Hudson's Bay is continuing to pay rent and professional fees related to the deal, 'in a seemingly futile effort to obtain the consent of the landlords,' according to an affidavit sworn by ReStore chief executive officer Ian Fredericks on Tuesday. So far, those costs have included roughly $2.5-million in rent to keep control over the empty stores involved in the deal. Hudson's Bay has projected that it will pay another $7.5-million in rent between June 30 and Aug. 15 as it pursues the transaction, according to the affidavit, and millions more in feeds. The lease deal is 'uneconomical and imprudent,' says the motion filed in the Ontario Superior Court of Justice. 'The current level of spending by HBC cannot be justified, and it is imperative that the costs of HBC's wind down be more effectively managed by the Monitor,' Mr. Fredericks's affidavit stated. The lenders are asking the court to expand the powers of the court-appointed monitor overseeing the creditor-protection process, to allow for the management of the wind-down. 'Hudson's Bay continues to manage the monetization of its assets and the wind-up of its affairs in a responsible and diligent manner, appropriately balancing the interests of various stakeholders in compliance with CCAA court orders and under the supervision of the court-appointed monitor,' company spokesperson Tiffany Bourré said. 'The first lien secured creditor has filed court materials to advance its own interests and Hudson's Bay will fully respond in due course.' Other objections raised by ReStore include $18-million in unnecessary spending by Hudson's Bay to remove signage at its shuttered stores, according to the court documents. While Hudson's Bay's liquidation sales generated significant interest among Canadians, and resulted in $54-million more than expected in net recoveries from those sales, the lenders' projected collateral shortfall has expanded, the documents state. That means the amount the lenders could expect to be repaid has fallen by at least $29-million, the motion says. Mr. Fredericks's affidavit calls the increase of costs on Hudson's Bay's part 'shocking.' If the court does not approve the 'super-monitor,' ReStore is asking for the appointment of a receiver to take control of the process. In the affidavit, Mr. Fredericks argued that 'there is no further alignment of interest between HBC's management and board of directors and the interests of creditors.'
CTV News
07-07-2025
- Business
- CTV News
Labour groups, lawyers hope fall of Hudson's Bay will spur change for workers
TORONTO — When Hudson's Bay employees rallied in front of two of the iconic retailer's properties in late May, days before the retailer closed its doors for good, they knew there was no hope of saving their jobs. Their goal instead was to encourage lawmakers to make the fall of the 355-year-old retailer — and all the failed companies that follow it — a little less painful for employees. They argued that could be done if the government adopted their wish list of ideas ranging from boosting federal support programs to prioritizing workers rather than lenders when companies in creditor protection are repaying what they owe. Such ideas were previously bandied around in labour circles when the Canadian divisions of Sears, Target and Nordstrom collapsed. This time, they're hoping the momentum lasts. 'When you're looking for these kinds of improvements, you will have ebbs and flows, but right now, we have an opportunity because the Bay situation is fresh in people's minds' said Lana Payne, president of Unifor. Her union orchestrated the rallies at one of the retailer's distribution centres in Toronto's Scarborough and another in front of a Windsor, Ont. store because Unifor represents about 595 of the 9,364 employees that worked at Canada's oldest company before it filed for creditor protection in March. The workers were told they will not get termination or severance pay and lost health, dental and life insurance benefits. A law firm representing them has warned that 'given HBC's significant amount of secured debt, it is not clear that employees will be able to recover any amounts owing to them directly from HBC.' The company has blamed its troubles on the COVID-19 pandemic, depressed store traffic and tariffs. After it failed to attract investors that would keep the company alive, it started to sell off its remaining assets in hopes of recouping as much as possible for the thousands of creditors. Back of the line When Canadian companies file for creditor protection, the various groups owed money are often left to jockey for what little cash remains, knowing there usually won't be enough to go around. Secured lenders are typically first in line because they have collateral backing the money they lent, often well before a company sought a reprieve from the courts. In the Bay's case there are 26 pages' worth of creditors, including secured senior lenders Restore Capital, Pathlight Capital and Bank of America. They alone are owed hundreds of thousands of dollars and have started to recoup some of their losses because the Bay has been paying them with cash from its liquidation sales. Employees are on the list of creditors, but they are not listed as secured and the amount owing is marked 'TBD.' 'I think it's pretty clear that workers are not the priority in these kinds of cases,' Payne said. 'The legislation doesn't make them the priority and workers right now are feeling the results of that.' In the future, Unifor would like to see legislation changed so workers' termination and severance claims are paid first, Payne said. Susan Ursel, a lawyer representing Bay employees, agrees with the idea because 'employees are affected in a personal way by their employer's insolvency — losing their income and throwing their futures into uncertainty. 'Unlike sophisticated lenders, they are not able to negotiate security for the contractual promises of their employers and therefore fall behind those secured lenders in recovering money owed to them,' she wrote in an email. 'A legislative priority for employees would provide more certain and effective protection for employees, which we would welcome.' But Sunira Chaudhri, founding lawyer at Workly Law in Toronto, worries that change would scare away lenders long before creditor protection is on the horizon and when companies still have a shot at recovery. 'If employees were to be first in line ... any employer that hired a lot of employees would be a bad bet for the banks,' she said. 'You'd want to lend money to them the least, because you'd never be able to recoup on a loan.' Jared Ong, an organizer with the Workers' Action Centre, has heard that argument before. He doesn't agree with it. 'Year on year, the major banks keep making billions more, but compare that to a worker who might be one or two paycheques away from losing a roof over their head,' he said. Existing supports Workers left without a job when their company goes under are typically able to lean on two federal government programs, but Ong said they need to be more generous. The first is employment insurance, which pays employees out of work a portion of their salary while they look for a new job. To qualify, applicants must have gone without work and pay for at least seven consecutive days in the last 52 weeks. The second is the Wage Earner Protection Program, which helps workers whose employees filed for creditor protection recoup owed wages, vacation, termination or severance pay. Bay employees have until Oct. 26 to apply for WEPP, after an extension to their deadline was granted by Service Canada. People who qualify under the program can earn up to $8,844.22 this year — a cap Unifor wants raised. Nadia Zaman, an employment lawyer at Rudner Law, thinks a higher ceiling makes sense, especially for workers who have been with a company for a long time. They generally wind up entitled to a lot more than WEPP's cap, so the program puts them 'essentially at a loss,' she said. While many people don't realize the program exists or understand some of the idiosyncrasies workers face when their company goes out of business, Zaman said the Bay is putting a spotlight on labour relations. 'A lot of people who haven't personally been through the situation, they are becoming more aware of it,' she said, 'And they are also looking for changes even if they haven't been personally affected.' The likelihood of turning that desire for change into actual change may seem 'grim,' acknowledged Ong at the Workers' Action Centre. Labour activists have seen momentum turn into disappointment before. For example, a 2014 Ontario bill pushing businesses to insure long-term disability benefits, so they'd be paid out even if an employer folded, passed, but was seemingly never enacted. Change, said Ong, is 'always a back-and-forth fight.' 'You win some things, you lose some things, government changes, but we need to keep pushing regardless of what happens.' This report by The Canadian Press was first published July 7, 2025. Tara Deschamps, The Canadian Press
Hamilton Spectator
07-07-2025
- Business
- Hamilton Spectator
Labour groups, lawyers hope fall of Hudson's Bay will spur change for workers
TORONTO - When Hudson's Bay employees rallied in front of two of the iconic retailer's properties in late May, days before the retailer closed its doors for good, they knew there was no hope of saving their jobs. Their goal instead was to encourage lawmakers to make the fall of the 355-year-old retailer — and all the failed companies that follow it — a little less painful for employees. They argued that could be done if the government adopted their wish list of ideas ranging from boosting federal support programs to prioritizing workers rather than lenders when companies in creditor protection are repaying what they owe. Such ideas were previously bandied around in labour circles when the Canadian divisions of Sears, Target and Nordstrom collapsed. This time, they're hoping the momentum lasts. 'When you're looking for these kinds of improvements, you will have ebbs and flows, but right now, we have an opportunity because the Bay situation is fresh in people's minds' said Lana Payne, president of Unifor. Her union orchestrated the rallies at one of the retailer's distribution centres in Toronto's Scarborough and another in front of a Windsor, Ont. store because Unifor represents about 595 of the 9,364 employees that worked at Canada's oldest company before it filed for creditor protection in March. The workers were told they will not get termination or severance pay and lost health, dental and life insurance benefits. A law firm representing them has warned that 'given HBC's significant amount of secured debt, it is not clear that employees will be able to recover any amounts owing to them directly from HBC.' The company has blamed its troubles on the COVID-19 pandemic, depressed store traffic and tariffs. After it failed to attract investors that would keep the company alive, it started to sell off its remaining assets in hopes of recouping as much as possible for the thousands of creditors. Back of the line When Canadian companies file for creditor protection, the various groups owed money are often left to jockey for what little cash remains, knowing there usually won't be enough to go around. Secured lenders are typically first in line because they have collateral backing the money they lent, often well before a company sought a reprieve from the courts. In the Bay's case there are 26 pages' worth of creditors, including secured senior lenders Restore Capital, Pathlight Capital and Bank of America. They alone are owed hundreds of thousands of dollars and have started to recoup some of their losses because the Bay has been paying them with cash from its liquidation sales. Employees are on the list of creditors, but they are not listed as secured and the amount owing is marked 'TBD.' 'I think it's pretty clear that workers are not the priority in these kinds of cases,' Payne said. 'The legislation doesn't make them the priority and workers right now are feeling the results of that.' In the future, Unifor would like to see legislation changed so workers' termination and severance claims are paid first, Payne said. Susan Ursel, a lawyer representing Bay employees, agrees with the idea because 'employees are affected in a personal way by their employer's insolvency — losing their income and throwing their futures into uncertainty. 'Unlike sophisticated lenders, they are not able to negotiate security for the contractual promises of their employers and therefore fall behind those secured lenders in recovering money owed to them,' she wrote in an email. 'A legislative priority for employees would provide more certain and effective protection for employees, which we would welcome.' But Sunira Chaudhri, founding lawyer at Workly Law in Toronto, worries that change would scare away lenders long before creditor protection is on the horizon and when companies still have a shot at recovery. 'If employees were to be first in line ... any employer that hired a lot of employees would be a bad bet for the banks,' she said. 'You'd want to lend money to them the least, because you'd never be able to recoup on a loan.' Jared Ong, an organizer with the Workers' Action Centre, has heard that argument before. He doesn't agree with it. 'Year on year, the major banks keep making billions more, but compare that to a worker who might be one or two paycheques away from losing a roof over their head,' he said. Existing supports Workers left without a job when their company goes under are typically able to lean on two federal government programs, but Ong said they need to be more generous. The first is employment insurance, which pays employees out of work a portion of their salary while they look for a new job. To qualify, applicants must have gone without work and pay for at least seven consecutive days in the last 52 weeks. The second is the Wage Earner Protection Program, which helps workers whose employees filed for creditor protection recoup owed wages, vacation, termination or severance pay. Bay employees have until Oct. 26 to apply for WEPP, after an extension to their deadline was granted by Service Canada. People who qualify under the program can earn up to $8,844.22 this year — a cap Unifor wants raised. Nadia Zaman, an employment lawyer at Rudner Law, thinks a higher ceiling makes sense, especially for workers who have been with a company for a long time. They generally wind up entitled to a lot more than WEPP's cap, so the program puts them 'essentially at a loss,' she said. While many people don't realize the program exists or understand some of the idiosyncrasies workers face when their company goes out of business, Zaman said the Bay is putting a spotlight on labour relations. 'A lot of people who haven't personally been through the situation, they are becoming more aware of it,' she said, 'And they are also looking for changes even if they haven't been personally affected.' The likelihood of turning that desire for change into actual change may seem 'grim,' acknowledged Ong at the Workers' Action Centre. Labour activists have seen momentum turn into disappointment before. For example, a 2014 Ontario bill pushing businesses to insure long-term disability benefits, so they'd be paid out even if an employer folded, passed, but was seemingly never enacted. Change, said Ong, is 'always a back-and-forth fight.' 'You win some things, you lose some things, government changes, but we need to keep pushing regardless of what happens.' This report by The Canadian Press was first published July 7, 2025.
Winnipeg Free Press
07-07-2025
- Business
- Winnipeg Free Press
Labour groups, lawyers hope fall of Hudson's Bay will spur change for workers
TORONTO – When Hudson's Bay employees rallied in front of two of the iconic retailer's properties in late May, days before the retailer closed its doors for good, they knew there was no hope of saving their jobs. Their goal instead was to encourage lawmakers to make the fall of the 355-year-old retailer — and all the failed companies that follow it — a little less painful for employees. They argued that could be done if the government adopted their wish list of ideas ranging from boosting federal support programs to prioritizing workers rather than lenders when companies in creditor protection are repaying what they owe. Such ideas were previously bandied around in labour circles when the Canadian divisions of Sears, Target and Nordstrom collapsed. This time, they're hoping the momentum lasts. 'When you're looking for these kinds of improvements, you will have ebbs and flows, but right now, we have an opportunity because the Bay situation is fresh in people's minds' said Lana Payne, president of Unifor. Her union orchestrated the rallies at one of the retailer's distribution centres in Toronto's Scarborough and another in front of a Windsor, Ont. store because Unifor represents about 595 of the 9,364 employees that worked at Canada's oldest company before it filed for creditor protection in March. The workers were told they will not get termination or severance pay and lost health, dental and life insurance benefits. A law firm representing them has warned that 'given HBC's significant amount of secured debt, it is not clear that employees will be able to recover any amounts owing to them directly from HBC.' The company has blamed its troubles on the COVID-19 pandemic, depressed store traffic and tariffs. After it failed to attract investors that would keep the company alive, it started to sell off its remaining assets in hopes of recouping as much as possible for the thousands of creditors. Back of the line When Canadian companies file for creditor protection, the various groups owed money are often left to jockey for what little cash remains, knowing there usually won't be enough to go around. Secured lenders are typically first in line because they have collateral backing the money they lent, often well before a company sought a reprieve from the courts. In the Bay's case there are 26 pages' worth of creditors, including secured senior lenders Restore Capital, Pathlight Capital and Bank of America. They alone are owed hundreds of thousands of dollars and have started to recoup some of their losses because the Bay has been paying them with cash from its liquidation sales. Employees are on the list of creditors, but they are not listed as secured and the amount owing is marked 'TBD.' 'I think it's pretty clear that workers are not the priority in these kinds of cases,' Payne said. 'The legislation doesn't make them the priority and workers right now are feeling the results of that.' In the future, Unifor would like to see legislation changed so workers' termination and severance claims are paid first, Payne said. Susan Ursel, a lawyer representing Bay employees, agrees with the idea because 'employees are affected in a personal way by their employer's insolvency — losing their income and throwing their futures into uncertainty. 'Unlike sophisticated lenders, they are not able to negotiate security for the contractual promises of their employers and therefore fall behind those secured lenders in recovering money owed to them,' she wrote in an email. 'A legislative priority for employees would provide more certain and effective protection for employees, which we would welcome.' But Sunira Chaudhri, founding lawyer at Workly Law in Toronto, worries that change would scare away lenders long before creditor protection is on the horizon and when companies still have a shot at recovery. 'If employees were to be first in line … any employer that hired a lot of employees would be a bad bet for the banks,' she said. 'You'd want to lend money to them the least, because you'd never be able to recoup on a loan.' Jared Ong, an organizer with the Workers' Action Centre, has heard that argument before. He doesn't agree with it. 'Year on year, the major banks keep making billions more, but compare that to a worker who might be one or two paycheques away from losing a roof over their head,' he said. Existing supports Workers left without a job when their company goes under are typically able to lean on two federal government programs, but Ong said they need to be more generous. The first is employment insurance, which pays employees out of work a portion of their salary while they look for a new job. To qualify, applicants must have gone without work and pay for at least seven consecutive days in the last 52 weeks. The second is the Wage Earner Protection Program, which helps workers whose employees filed for creditor protection recoup owed wages, vacation, termination or severance pay. Bay employees have until Oct. 26 to apply for WEPP, after an extension to their deadline was granted by Service Canada. People who qualify under the program can earn up to $8,844.22 this year — a cap Unifor wants raised. Nadia Zaman, an employment lawyer at Rudner Law, thinks a higher ceiling makes sense, especially for workers who have been with a company for a long time. They generally wind up entitled to a lot more than WEPP's cap, so the program puts them 'essentially at a loss,' she said. While many people don't realize the program exists or understand some of the idiosyncrasies workers face when their company goes out of business, Zaman said the Bay is putting a spotlight on labour relations. 'A lot of people who haven't personally been through the situation, they are becoming more aware of it,' she said, 'And they are also looking for changes even if they haven't been personally affected.' The likelihood of turning that desire for change into actual change may seem 'grim,' acknowledged Ong at the Workers' Action Centre. Monday Mornings The latest local business news and a lookahead to the coming week. Labour activists have seen momentum turn into disappointment before. For example, a 2014 Ontario bill pushing businesses to insure long-term disability benefits, so they'd be paid out even if an employer folded, passed, but was seemingly never enacted. Change, said Ong, is 'always a back-and-forth fight.' 'You win some things, you lose some things, government changes, but we need to keep pushing regardless of what happens.' This report by The Canadian Press was first published July 7, 2025.
