8/19/2019

Hudson's Bay Soars After Catalyst Buys Stake to Block Chairman

Bloomberg (08/19/19) Deveau, Scott

Catalyst Capital Group Inc. has acquired a 10% stake in Hudson's Bay Co. (HBAYF) as part of its efforts to block a proposed takeover by Chairman Richard Baker and his partners. The Toronto-based private equity firm said it had received and accepted about 18.5 million shares in Hudson's Bay for about C$187 million ($141 million) in cash at C$10.11 per share—a premium to the C$9.45 a share offer from the group led by Baker, which collectively owns about 58% of the company. The announcement pushed up the stock 9% in Toronto, marking its biggest gain in more than two months. The move adds to pressure on Baker to raise his bid, which also is opposed by investor Jonathan Litt. "We look forward to working with HBC, the special committee of the board, and the company's stakeholders to ensure that this iconic company and its substantial assets are positioned to unlock value and that any transaction or strategic alternative maximizes value for the benefit of all shareholders," said Catalyst managing director and partner Gabriel de Alba. Baker's push to take the company private by purchasing the remaining shares his group did not already own would require the support of the majority of the remaining minority shareholders, making Catalyst's move crucial. Catalyst and Litt were among the investors who purchased shares sold by Ontario Teachers' Pension Plan in June, though their stakes remain unknown.

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