Hudson’s Bay Co. fought to avoid a total closure in a Toronto court on Monday, asking permission to start liquidating most of its stores this week.
A lawyer of the oldest company in Canada, Ashley Taylor, said HBC’s efforts to resolve their liquidity crisis have “failed”. Taylor also declared before an audience full in the Superior Court of Justice of Ontario that if the retailer does not achieve a viable solution with its creditors and owners, it must be completely settled.
HBC, which owes approximately US $ 770 million in guaranteed debt, requested authorization to sell inventory during the next three months to obtain cash. Judge Peter Osborne postponed the process on Monday without issuing a ruling.
HBC was founded in 1670, before Canada itself, to operate in a wide strip of what British North America was then. Currently, the company operates 104 stores and uses more than 9300 people. HBC owns Hudson’s Bay, Thebay.com and Saks Fifth Avenue, and is the company with the greatest career in continuous operation in North America.
HBC argued in a statement issued on Friday to avoid total settlement would allow you to preserve jobs.The company identified at least 121 key employees and 25 stores necessary for a partial liquidation processaccording to Alvarez & Marsal Canada Inc., the company that supervises the process with the creditors.
Earlier this month, the Court approved a financing line for bankruptcy companies for US $ 11.20 million to cover operations during the liquidation period. The amount increased to US $ 16.09 million, according to a specifications dated Monday.
The court listened to concerns on Monday The rent owed to the owner of commercial real estate riocan reitwith which HBC has a joint company for 12 properties.
The Court agreed earlier this month to suspend the payment of the HBC rent to the joint company, which amounts to approximately 10 million Canadian dollars monthly. Riocan presented on Friday a motion to cancel this suspension, qualifying it as “unprecedented.” “Riocan considers that the suspension of rent does not constitute a fair or reasonable treatment,” says the motion, “and is incompatible with the law.”
Most HBC rental payments have been delayed, according to the monitor report.
Over the years, Physical stores have had difficulty competing with electronic commerce businesses as purchasing habits have changed. HBC was privatized in March 2020 in an operation of US $ 769.69 million.
The severity of the Covid-19 pandemic inflicted deeper injuries to the company’s salesand since then he has not been able to completely recover the pedestrian traffic and the sales of his stores, HBC told the court.
