Saks Inc. said it reached an agreement to settle lawsuits by investors seeking to block the retailer’s $2.4 billion acquisition by Canadian department-store chain Hudson’s Bay Co.
The agreement decreases the potential termination fee from Saks to Hudson’s Bay if the deal fails, and shortens the period in which the Canadian company can match any alternative offer, Saks said today in a regulatory filing. The agreement will pave the way for the dismissal of the lawsuits, the company said.
Hudson’s Bay, founded in the 17th century as a fur-trading company, agreed in July to pay $16 a share in cash, a 30 percent premium to New York-based Saks’s closing price on May 20, the day before reports emerged that Saks was exploring alternatives. Investors including Thomas Jennings and Samuel Cohen filed suits against Saks, its directors and Hudson’s Bay. Jennings had said the proposed deal undervalued Saks.
The transaction would bring together the Hudson’s Bay, Lord & Taylor and Saks Fifth Avenue brands, creating a company with more than 300 stores and revenue of about $7 billion.