Even though Saks (NYSE: SKS) executives were hoping its acquisition by Hudson's Bay would be wrapped up months ago, investors sued to stop the $2.4 million transaction.
Today, October 22, Saks said it had reached an agreement that will pave the way to settle the suits, which decreases the potential termination fee from Saks to Hudson's Bay if the deal fails. Saks also agreed to shorten the period in which the Canadian-based Hudson's Bay can match any alternative offer.
The transaction joins the Hudson's Bay, Lord & Taylor and Saks Fifth Avenue brands, creating a mega-fashion retail company with revenue of around $7 million and more than 300 stores.
While Hudson's Bay said in July it would pay $16 a share in cash for Saks, investors including Thomas Jennings and Samuel Cohen filed suits against Saks, its directors and Hudson's Bay.
At the time, Jennings said the proposed deal undervalued Saks.
Soon after the acquisition goes through, Hudson's plans to open seven Saks stores in Canada, followed by a global expansion. In addition, an executive shakeup at Saks will occur after the deal closes. The resignations of Chairman and CEO Stephen I. Sadove and President and CMO Ronald L. Frasch will become effective as soon as an agreement is reached.
For more, see:
This Bloomberg article
Saks Will Expand to Asia and Europe, Says Hudson Bay Exec
Saks Execs to Exit After Hudson Bay Sale
Harrods' McKee To Take Over At Saks
Saks Agrees To Hudson's Bay Buyout, No Lord & Taylor Merger
Saks Reported To Be For Sale Again, Possibly To Merge With Neiman Marcus