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Hudson's Bay rejects offer for its German department store chain

Hudson's Bay Co. rejected a €3 billion offer from SIGNA Holding GmbH to acquire Galeria Kaufhof GmbH, Hudson's Bay's German department store chain, the department store operator said Feb. 7.

The offer "significantly undervalues our German business and related real estate assets and is not supported by sufficient certainty of financing," said David Leith, lead independent director of the company's board of directors, in a statement.

The board rejected the proposal unanimously, Hudson's Bay said, and SIGNA withdrew its offer.

Hudson's Bay confirmed the unsolicited offer Nov. 1, 2017. It said at the time that SIGNA, the Austrian property and retail group that owns rival German department store chain Karstadt Warenhaus GmbH, had "no evidence of financing."

SIGNA's unsolicited offer fueled conflict between Hudson's Bay and activist investor Land & Buildings Investment Management LLC, which has been urging the department store operator to sell off its real estate and to consider the sale of Galeria Kaufhof. In a Nov. 2, 2017, letter to investors, Land & Buildings said Hudson's Bay's claim that the company had seen no evidence of financing was "perplexing."

The news of the rejection comes the same week that the company announced that Helena Foulkes, executive vice president at CVS Health Corp. and president of CVS Pharmacy, will be the new CEO of Hudson's Bay, effective Feb. 19.