- Canada's oldest retailer (founded 1670) files for creditor protection
- 80+ stores at risk amid consumer spending declines
- US-Canada tariff threats derailed $150M rescue deals
- Saks Fifth Avenue locations remain operational through separate agreement
Hudson's Bay, the cornerstone of Canadian retail since the fur trade era, has taken emergency measures to avoid becoming another casualty of modern economic pressures. The 354-year-old institution filed for creditor protection with Ontario courts on Friday, citing a perfect storm of reduced downtown foot traffic, international trade disputes, and what CEO Liz Rodbell called unprecedented market volatility.
Industry analysts note this move follows a 22% year-over-year decline in brick-and-mortar sales across Canadian department stores, with urban locations particularly hard-hit. Unlike Sears Canada's 2017 collapse, Hudson's Bay aims to leverage creditor protection to renegotiate leases rather than liquidate - a strategy that preserved 74% of ToysRUs Canada stores during its 2021 restructuring.
The company's troubles intensified when proposed tariffs on Canadian aluminum exports disrupted critical funding talks. Three potential investors withdrew from $150M financing deals following Washington's threats, creating what Rodbell described as a climate of paralyzing uncertainty.This development underscores how cross-border trade policies now directly impact retail survival.
While 93 Hudson's Bay/Saks locations face restructuring, the separate Saks Global ownership structure keeps premium US stores unaffected. This bifurcated approach reflects growing trends in retail bankruptcy proceedings, where companies increasingly isolate profitable assets. The retailer's licensing model for luxury brands could become a blueprint for heritage stores navigating digital transformation.
Quebec's Simons department store chain offers a regional success contrast, having doubled online sales through localized inventory and experiential retail. Hudson's Bay now faces pressure to similarly modernize while preserving its historic identity - a balancing act requiring both financial restructuring and cultural reinvention.