Hudson’s Bay landlords returned to court on Friday to dispute the financial capability of a British Columbia billionaire aiming to establish a new retail store. Ruby Liu is seeking to acquire 25 additional leases from the Bay for $69.1 million to launch a department store under her name. The court had previously approved her purchase of three Bay leases for $6 million located in malls she already owns.
The Bay is motivated to sell the leases to assist in repaying a significant portion of its approximately $1 billion debt to creditors. The retailer views the larger deal with Liu as crucial for realizing value from its 98 leases. While Hudson’s Bay contends that Liu possesses the necessary funds to initiate and sustain a department store, the landlords argue against her business plan and experience, emphasizing their interest in reclaiming the leases.
Key landlords such as Cadillac Fairview, Oxford Properties, and Ivanhoé Cambridge vehemently oppose the sale, expressing concerns about Liu’s lack of experience and inadequate resources for executing her ambitious plans within the proposed timeline. They question the feasibility of her announced $400 million investment and highlight uncertainties regarding her financial commitments, citing her overseas financial holdings.
Liu, who intends to utilize a company owned by Techion Global Investments Ltd. to acquire the Bay leases, faces scrutiny over her financial standing and the viability of leveraging her stakes in B.C. malls for funding. The landlords point out the malls’ recent financial losses and question the reliability of these assets for supporting Liu’s venture. Additionally, concerns are raised about the inexperience of Liu’s team, casting doubts on their ability to manage operations effectively.
The court proceedings witnessed arguments from both sides, with landlords emphasizing the risks associated with approving the lease sale to Liu. Alvarez & Marsal, an independent monitor overseeing the Bay’s creditor protection, expressed reservations about Liu’s preparedness and the competency of her team. Despite the uncertainties, the hearing concluded without a final decision from Judge Peter Osborne.
The outcome of this legal battle remains uncertain, with stakeholders closely monitoring the developments as the case progresses.
