In other news, HBC is exiting Germany with an agreement to sell the remaining stake in its German real estate joint venture, and divest its related retail joint venture to its partner, SIGNA, along with assumption of certain obligations for a total consideration of $1.5 billion (Canadian dollars).
"We believe that improving (Hudson's Bay's) performance will require significant time and patient long-term capital that is better suited in a private company context without the emphasis on short-term results and returns", said Baker in a statement. The group controls 57 per cent of the company's shares.
At $9.45 Canadian per share, the take-private bid would provide shareholders a 48% premium on HBC's closing share price from Friday while giving the majority shareholders the chance to turn the business around without the pressures of the public market.
In a statement, CEO Helena Foulkes said that the deal to retreat from Europe allows the retailer to "fully focus our resources on HBC's North American operations, including our best growth opportunities - Saks Fifth Avenue and Hudson's Bay".
Struggling department store giant Hudson's Bay Co. has received a proposal to go private.
The strategy was successful in attracting former Sears Canada customers shortly after the rival chain closed previous year, Foulkes said, but "I think we took it too far". She announced on May 6 that it's announcing strategic alternatives for its Lord and Taylor operating business, which is primarily in the eastern United States. The European deal is the latest step in Foulkes's everything-is-on-the-table approach, which has included selling flash-sale website Gilt and earlier merging its European operations with a rival department-store chain. "This transaction is another bold action that unlocks the value of our real estate and demonstrates our resolve to creating a stronger, more capable HBC".
The company said a special committee of independent directors will review the shareholders' privatization proposal and oversee a formal valuation.
The committee will be chaired by David Leith, a former head of investment, corporate and merchant banking at CIBC World Markets and a member of HBC's board of directors since November 2012.
The offer, announced Monday, is being led by Hudson's Bay Executive Chairman Richard Baker, Rhone Capital LLC, WeWork Property Advisors, Hanover Investment SA and Abrams Capital Management.