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Hudson’s Bay Hires Valuation Expert to Review Take-Private Offer

The Hudson’s Bay Co.’s special committee has hired TD Securities Inc. for an independent valuation of the take-private proposal Richard Baker, the company’s executive chairman, submitted last month.

The offer was submitted to the Canadian department store firm on June 10, and is valued as a $1.31 billion all-cash, go-private deal. Baker was joined by other shareholders, including Rhône Capital and WeWork Property Advisors, among others. The per-share offer is at 9.45 Canadian dollars, or $7.50, which pegs the deal at 1.74 billion Canadian dollars ($1.31 billion).

Hudson’s Bay Co.’s board of directors formed the special committee to evaluate the offer. In a statement Wednesday, the special committee said it acknowledges shareholders’ feedback on the proposed privatization transaction, and that it “takes this input seriously and intends to review the transaction proposal carefully with the assistance of its legal and financial advisors and the benefit of the independent valuation.”

The special committee also said it intends to respond to the proposal as soon as is practical. Hudson’s Bay said it does not intend to comment, or even disclose further developments connected with the special committee’s evaluation, unless it is required to do so or deems the disclosure “appropriate.”

The take-private proposal from Baker and his fellow shareholders drew the ire of activist investor Land & Buildings. The activist investor, through its leader Jonathan Litt, complained the offer was “woefully inadequate,” citing an undervaluation of the the company’s “exceptional assets.” That’s not a surprise since he’s trying to get a higher price for a better return on his investment in the retail operator.

Hudson’s Bay operates the retail nameplates Hudson’s Bay, Saks Fifth Avenue and Saks OFF 5th. It is currently exploring strategic options for its Lord & Taylor operation.