Proxy advisers Glass Lewis and Egan-Jones both recommend that Hudson's Bay Co. shareholders vote in favor of the proposed privatization deal by an investor group led by Executive Chairman Richard Baker, the Canadian department store operator said Dec. 11.

The recommendation from both firms came after another proxy adviser group, Institutional Shareholder Services, urged shareholders not to go with the C$1.9 billion plan because it is lower than the takeover offer of Catalyst Capital Group, Hudson's Bay's third-largest individual shareholder.

The company subsequently dismissed the ISS report and called it "flawed."

Hudson's Bay said Glass Lewis recommended that shareholders vote for the privatization deal with the Baker-led group because it "would provide unaffiliated shareholders with certainty of value for their [Hudson's Bay] shares at a sizable market premium and a relatively attractive valuation," among other reasons.

Separately, Hudson's Bay said Egan-Jones also sided with the Baker-led group as it would "be a desirable approach in maximizing shareholder value," among other factors.

"The support of these independent proxy advisers further demonstrates that this transaction represents the best path forward for [Hudson's Bay], is fair to the minority shareholders, and provides certain and immediate value at a significant market premium," said David Leith, chair of Hudson Bay's special committee.

Shareholders are scheduled to vote on the matter at a Dec. 17 meeting.

Hudson's Bay's stock closed down 3.99% to C$8.43.