Hudson’s Bay landlords returned to court on Friday to dispute claims that a wealthy individual in British Columbia lacks the financial resources required to establish a new retail enterprise. Ruby Liu is seeking to acquire an additional 25 leases from the Bay for $69.1 million to establish a department store under her name. The court had previously approved her purchase of three Bay leases in malls she owns for $6 million.
Hudson’s Bay is motivated to sell the leases to Liu in order to repay a portion of its substantial debt to creditors, amounting to around $1 billion. The retailer views the larger deal with Liu as crucial for realizing value from its 98 leases.
Despite Hudson’s Bay asserting that Liu possesses the necessary funds and capabilities to launch and manage a department store, prominent landlords such as Cadillac Fairview, Oxford Properties, and Ivanhoé Cambridge strongly oppose the sale. These landlords argue that Liu lacks the requisite experience and team to successfully implement her ambitious plans within the proposed timeline and budget.
The landlords contest Liu’s claim of having $400 million earmarked for the new chain, with allegations that such funds do not exist or are not readily available. Liu’s proposed acquisition of the Bay is facilitated through a company owned by Techion Global Investments Ltd., registered in the British Virgin Islands. Additionally, her financial assets are located in Hong Kong and Singapore, not within Canada.
Liu maintains that she has the financial capacity, supported by her ownership stakes in several British Columbia malls. However, the landlords contest this assertion, pointing out significant losses incurred by these malls in recent years, arguing that they cannot serve as reliable sources of funding for Liu’s venture.
Furthermore, the landlords raise concerns about the experience and competence of the team Liu has assembled for the retail project, highlighting the lack of retail industry professionals in key positions. Alvarez & Marsal, an independent monitor appointed by the court, has also expressed skepticism about Liu’s readiness and the commercial viability of her business plan.
As the court hearing concluded without a decision on the leases, Liu remained optimistic about her prospects despite the ongoing legal battle with the landlords.