U.S. court case sees Saks Global accuse lender of contributing to Bay's demise
TORONTO - Saks Global is putting some of the blame for Hudson's Bay's demise on one of the faltering department store's top lenders.
A letter Saks Global filed earlier this month in a New York lawsuit against Pathlight Capital LP said the lender was a 'direct cause' of Hudson's Bay's inability to secure 'much-needed financing.'
'As a result of these actions and inactions by Pathlight, HBC was forced to initiate restructuring proceedings under the Companies' Creditors Arrangement Act (CCAA) in Canada,' Saks Global chief legal officer Andrew Woodworth said in a March 26 letter to Pathlight's managing director.
'Pathlight's ongoing intransigence further frustrated HBC's CCAA proceedings, and, on March 21, 2025, forced HBC to announce a near total liquidation.'
After the letter was sent on March 26, Hudson's Bay determined that it was not going to find the money it needed to keep all of its stores alive. With little hope left, Canada's oldest company decided to take its liquidation even further and is due to sell off all merchandise at its 80 stores and 16 under the Saks name by Sunday.
The Saks stores in Canada were operated through a license Hudson's Bay had with Saks Global.
Neither company nor lawyers for the firms or Pathlight immediately responded to a request for comment.
Saks Global was formed last year, when Hudson's Bay purchased Neiman Marcus and Bergdorf Goodman and spun them out with its existing Saks Fifth Avenue into a new company.
Court documents say that transaction was made possible in part because Pathlight agreed to release Saks Global from obligations under a loan the Bay had in exchange for millions in payments.
Now, Pathlight is suing Saks Global because it has yet to be paid US$8.8 million it is owed.
Saks is refusing to pay the sum because it says Pathlight 'cannot and should not benefit from its own actions,' which hurt the Bay.
At the start of Hudson's Bay's creditor protection case in Canada, Pathlight was listed as a secured creditor owed more than $95 million.
This report by The Canadian Press was first published May 30, 2025.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
27 minutes ago
- Yahoo
High-cost loans, Trump turmoil hurting Africa, says G20 panel chief
Critically needed economic growth in Africa is being held back by high borrowing costs imposed by international lenders, with unpredictable US policy changes adding to the strain, the head of the G20 panel on the continent said. Seasoned politician and anti-apartheid activist Trevor Manuel chairs the panel of experts working on proposals to address issues affecting Africa, including high debt, to be presented at a summit of the Group of 20 leading economies in November. African nations are not necessarily more indebted than major economies but they face higher debt servicing costs, Manuel told AFP in an interview. The "unbelievably expensive and prohibitive" cost of capital for African nations has hobbled their development, said Manuel, who served as finance minister in post-apartheid South Africa for more than a decade. "We know that the risk premiums in general on Africa are much higher than they need to be, and that impacts them on the debt service costs," he added. More than half of Africa's 1.3 billion people live in countries with debt interest payments higher than social spending on health, education and infrastructure, according to the South African government. South Africa is the only African nation in the G20 and has made debt sustainability for developing countries one of the priorities of its presidency of the group of 19 countries, the African Union and European Union. African countries will pay close to $89 billion in external debt service alone this year, with 20 low-income countries at risk of debt distress, it says. Manuel said the panel will seek to persuade the entire G20 to engage with multilateral development banks, in particular the World Bank and International Monetary Fund, to address the issue of borrowing costs. - 'Unbelievably difficult' - Abrupt changes in global order since US President Donald Trump took office in January, such as sweeping aid cuts and trade tariffs, will have long-lasting ramifications for the continent, Manuel said. Trump's "capricious" announcement in April of major trade tariffs effectively did away with the African Growth and Opportunity Act, a major US-African trade deal that had helped to build some African economies, he said. He cited as examples the tiny kingdom of Lesotho, which faces 50 percent tariffs on exports to the United States, including jeans and golf shirts, and Madagascar, which sends vanilla pods and is threatened with 47 percent tariffs. "It becomes unbelievably difficult for small countries that try and develop export markets, for their products to be struck by these sudden announcements," Manuel said. "There's no time for adjustment." Adding to the pressure is the termination of USAID programmes and a push for NATO countries to increase defence spending, which restricts what they have available for overseas development assistance. "The impact on the African continent is going to be very severe," said Manuel. "We can't abstract Africa from the rest of the globe." "The realm of policymaking requires a greater degree of predictability and certainty than what we see at the moment," he said. "The fact that there are these occasional outbursts that aren't informed by reality as I see it... makes it even more complex." - Intra-Africa - Manuel said his panel's work on better understanding the African economy and developing solutions was likely to continue beyond this year's G20, for example, via the UN Economic Commission for Africa and the African Union. This included looking at "intra-African dynamics" such as the role of the African Continental Free Trade Area (AfCFTA) launched in 2019. Conflicts also cost the continent, he said, citing the war in Sudan and unrest that has held back a major gas project in impoverished northern Mozambique. "When countries spend more on war than what they do on the upliftment of people, then we face profound consequences," Manuel said. He said a strong United Nations and African Union were important in "persuading countries to do the right things" in the long term, beyond the sometimes disruptive short electoral cycles that usher in new leadership and policy changes. "If you don't have those kinds of objectives, which frequently will not be completed within a particular electoral cycle, I think we run ourselves into the ground." br/ho/rl/cms
Business Upturn
an hour ago
- Business Upturn
Tata Tech shares lower after large block deal of 2.1% equity today
By Aditya Bhagchandani Published on June 4, 2025, 09:27 IST Shares of Tata Technologies Ltd traded lower on Tuesday after a large block deal involving a 2.1% equity stake, valued at approximately ₹634 crore, hit the markets. The deal was executed at a floor price of ₹744.5 per share, representing a 3% discount to Tata Technologies' closing price of ₹767.5 on June 3. As per media reports, the stake was sold by US-based private equity firm TPG through its arm TPG Rise Climate SF Pte Ltd. The transaction is being facilitated by BofA Securities and is reportedly structured as a 'clean-up trade,' indicating a strategic exit by the investor. Tata Technologies' stock opened on a weaker note and was trading at ₹762.80, down 0.61% from the previous close. The day's trading range was ₹754.20 to ₹765.50. The company's market cap stood at ₹308.26 billion, with a trailing P/E ratio of 45.67 and dividend yield of 1.10%. TPG's partial exit comes after a strong performance by Tata Tech stock, which has gained over 15% in the past month. Neither TPG nor BofA Securities has issued an official statement on the deal as of now. Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Stock market investments are subject to market risks. Always conduct your own research or consult a financial advisor before making investment decisions. Author or Business Upturn is not liable for any losses arising from the use of this information. Aditya Bhagchandani serves as the Senior Editor and Writer at Business Upturn, where he leads coverage across the Business, Finance, Corporate, and Stock Market segments. With a keen eye for detail and a commitment to journalistic integrity, he not only contributes insightful articles but also oversees editorial direction for the reporting team.
Business of Fashion
an hour ago
- Business of Fashion
Beauty's Hottest New Trend: The Founder Buyback
On Tuesday, influencer-turned-mogul Huda Kattan announced that she had regained majority ownership of her eponymous makeup brand, Huda Beauty, after buying back the minority stake private equity firm TSG Consumer Partners took in 2017, The Business of Beauty reported. The news arrived months after Kattan's sister Mona Kattan purchased Kayali, the fragrance brand she co-founded, alongside PE firm General Atlantic; that transaction set up funding for Huda Beauty's buyback. It was a sister act of multimillion dollar proportions. After last week's billion dollar acquisition of Rhode by E.l.f. Beauty and Church & Dwight's $700 million purchase of hand sanitiser label Touchland, the 2025 M&A beauty market appears to be looking up. But the arc of Huda Beauty traces along a bigger shift in the beauty industry. When the brand launched in 2013, it did so in the heat of the celebrity makeup moment; Kylie Jenner's pigmented lip kits and Rihanna's 40-shades of foundation came next. Billion dollar valuations followed for an elite set that included Kattan, Jenner and makeup artists like Anastasia Soare, Charlotte Tilbury and Pat McGrath. In the years since, some have seen their businesses flourish (see: Puig's majority acquisition of Charlotte Tilbury, valued at $1.2 billion) while others have lost their grip. In the decade since Huda Beauty's debut, a shiny new class of celebrity founders, like Bieber's Rhode and Selena Gomez's Rare Beauty, have risen to the vanguard, succeeding with direct customer relationships and outsize sales, strong operational teams and a simple but refined focus on exactly what they do well. A following is no longer enough in the cut-throat beauty business, unless you can continuously convert them to shoppers. The Social Network What does Kattan have? In addition to an estimated $450 million in annual sales as of 2024, the brand benefits from a wide international distribution and a wide array of best-sellers. But its most impressive feat may be that, despite 12 years in business — 120 years in beauty — Kattan hasn't lost her relevance online. Huda Beauty's best asset is Huda herself. As a vlogger, the US-born and Dubai-based Kattan was perhaps something of the original beauty influencer. Her own line, which she founded with her sisters Mona and Alya, was an instant hit, as her high-definition makeup looks (fluffy lashes, sleek contours) and a critic's eye toward formulas translated seamlessly into a cosmetic range that still mints regular hits, like last year's Easy Blur airbrush foundation. In 2014, four years after Instagram launched, Kattan hit 1 million followers; three years later, she had 18 million, and has 57 million today, according to the app. RivalIQ calculated that @hudabeauty's engagement rate is eight times the going average for beauty brands. If Kattan's public support of Palestinians in the Gaza war has polarised some of her audience, the tens of thousands of comments her posts draw seem only to strengthen her reach. Trends like the clean girl aesthetic and 'Euphoria' makeup may have come and gone, but Kattan's influence still powers Huda Beauty the brand; it consistently outranks others when it comes to social media performance. It was the #4 top ranked makeup brand in 2024, beating out LVMH's Dior and Fenty, said Launchmetrics. In the first quarter 2025, it was the top of CreatorIQ's list, narrowly besting Selena Gomez' Rare Beauty. Spate analyst Mathilde Riba reported that Huda Beauty charts nearly a 7 out of 10 on the firm's 'sentiment index.' Buyback to Bounce Back As a Revlon makeup artist living in opulent Dubai, Kattan's ultra-glam look hooked a generation of beauty obsessives on her cosmetics almost immediately. But two subsequent skincare forays, Wishful (launched in 2020) and Glowish (in 2021) were less successful, and ultimately didn't satisfy customers who had fallen for Kattan's contours and cut creases. The lines were eventually phased out of Sephora, and now linger on the line's e-commerce website. Kattan heads into the next phase 'hyper-focused' on Huda Beauty, she told Women's Wear Daily — an easier task without the distractions of the fragrance and skincare businesses. But the founder-led buyback can be tricky: French conglomerate Coty took a $71 million loss when it sold its stake in skincare brand Skkn back to founder Kim Kardashian three years after its purchase. And the clean label Beautycounter, which founder Gregg Renfrew bought out of bankruptcy last year, has taken time to reposition itself ahead of a relaunch scheduled for this summer. Huda Beauty and TSG may not have had the fairytale exit that Charlotte Tilbury scored with Puig, but given the glut of colour cosmetics brands currently in market, maybe it was the best outcome. The San Francisco-based TSG Consumer Partners, is known to be more of a short-term investor; the firm took a minority stake in It Cosmetics in 2012, cashing out in 2016 when the brand sold to L'Oréal for $1.2 billion. It made a similar manoeuvre with E.l.f., in which it bought a minority stake in 2011 that grew to a majority stake by 2014, two years before the line's IPO. More recently, it announced a 'strategic growth investment' in Marianna Hewitt and Lauren Ireland''s Summer Fridays, implying that influencer-fronted brands still have bright futures ahead. And what of the fierce competition? As more and more beauty brands come to market and also languish in the M&A waiting room, they'd be wise to stay close to their core. That's the thing about a once-in-a-lifetime founder: There's only one person who can see the vision through. Otherwise, they have to let it go. With additional reporting by Priya Rao. Sign up to The Business of Beauty newsletter, your complimentary, must-read source for the day's most important beauty and wellness news and analysis.
