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Hudson's Bay warns of more shop closures; Advent to convert Walmart's Brazil arm

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Hudson's Bay warns of more shop closures; Advent to convert Walmart's Brazil arm

TOP NEWS

* Canadian department store operator Hudson's Bay Co. warned that store closures at its other brands are possible after announcing plans to shutter up to 10 Lord & Taylor stores through 2019. The retailer is looking at closing stores at its other brands, including Saks Fifth Avenue, Hudson's Bay and Galeria Kaufhof, Hudson's Bay CFO Edward Record told analysts on a call after the company reported a first-quarter net loss. The department store chain will also exit its location on Fifth Avenue in New York City as it seeks to optimize the brand's digital business along with new leadership and an improved store footprint.

* Advent International Corp., the private equity firm that agreed to acquire 80% of Walmart Inc.'s Brazilian operations, plans to convert the U.S. retailer's underperforming hypermarkets into cash-and-carry wholesale stores rather than open new ones, Reuters reported, citing Patrice Etlin, a managing partner at Advent. Etlin reportedly disclosed the plan at an industry event in Sao Paulo, adding that Advent intends to invest "billions of reals" in operations over the next two years. Etlin added that they intend to expand Walmart's brands, including Maxxi and Todo Dia, along with membership-only retail chain Sam's Club but has yet to decide which regional brands acquired by Walmart in Brazil will be kept.

TEXTILES, APPAREL AND LUXURY GOODS

* The Kate Spade luxury brand, part of Tapestry Inc., has offered its condolences in the wake of its founding designer's apparent suicide. Kate Spade, 55, was found dead at her Park Avenue apartment in New York City on June 5, The Associated Press reported. She had no affiliation with the brand bearing her name for more than a decade.

* H&M Hennes & Mauritz AB will "gradually" change the sizes of its womenswear offerings in the U.K. after customers complained that the Swedish clothing chain translated its European measurements to a lower U.K. size. A company spokesperson told The Guardian that customers will experience a transition period during the change and advised shoppers to use H&M's online sizing guides or seek assistance from the retailer's in-store staff.

E-COMMERCE

* Amazon.com Inc. plans to increase its investment in India to $7 billion after retail giant Walmart Inc. announced its bid to acquire 77% of Flipkart Online Services Pvt. Ltd., CNBC's Indian affiliate CNBC TV-18 reported, citing sources. The Seattle-based online giant previously planned to invest $5 billion in the country but reportedly is adding another $2 billion to its plan to stay competitive with Walmart. The sources told the news outlet that Amazon may increase its investment even more over time since the company's interest to expand is much higher.

* Alibaba Group Holding Ltd.'s logistics arm Cainiao Network said that it is leading a joint venture which will invest about US$1.5 billion to set up a digital logistics center in Hong Kong. Cainiao has a 51% stake in the JV, while China Aviation Corp. (Group) Ltd. holds 35% and Chinese courier and logistics company YTO Express Group Co. Ltd. has 14%. The move is part of Alibaba's commitment to invest more than 100 billion Chinese yuan into building a global logistics network as it aims to eventually make deliveries within 24 hours in China and 72 hours around the world.

FOOD AND STAPLES RETAILING

* Waitrose Ltd and healthcare company Bupa will team up to offer health services in stores of the supermarket operator across the U.K. From the week beginning June 4 to Sept. 1, 17 Waitrose stores will trial a range of Bupa services such as self-testing health stations as well as health assessments and talks from Bupa experts.

* PJSC Magnit is in talks with Marathon Group to acquire pharmaceutical distributor SIA International Ltd., in line with the store operator's plans to expand into Russia's retail pharmacy market. Magnit is conducting its due diligence on the SIA Group and will take into account the results of the process in the course of the negotiations.

HOUSEHOLD DURABLES AND SPECIALTY RETAIL

* PetSmart Inc. moved more than a third of Chewy.com Inc.'s equity to separate entities, preventing creditors who funded the acquisition of the online pet food retailer from accessing the assets, sources told Bloomberg News. The pet specialty retailer reportedly transferred 20% of Chewy's stocks to a holding company controlled by BC Partners, PetSmart's private equity parent, through a dividend, while 16.5% of the shares were sent to a PetSmart unrestricted subsidiary.

* Sharp Corp. expects to make Toshiba Corp.'s personal computer business profitable in one to two years, President Jeng-wu Tai told the Nikkei Asian Review after the Japanese consumer electronics firm announced its ¥4 billion transaction with the industrial conglomerate. Tai, in an interview sent to the newspaper by Taiwanese parent Hon Hai Precision Industry Co. Ltd., said he anticipates that the same method used to turn around profitability for Sharp will work on Toshiba's PC unit.

HOTELS, CASINOS AND GAMING

* Bangkok-based hospitality and leisure company Minor International Public Company Ltd agreed to buy HNA Group Co. Ltd.'s 25.2% stake in NH Hotel Group SA in a two-tranche transaction valued at €619 million, following its earlier purchase of a 9.5% holding in the Spanish company. The acquisition of the Chinese conglomerate's stake in NH Hotel puts Minor's ownership over the 30% limit required under Spanish law to kick-start a full takeover bid. As such, Minor also will launch an all-cash public tender offer for all shares it does not already own in NH Hotel at a price not less than €6.40 per share, subject to fair price adjustments.

INDUSTRY NEWS

* U.K. retail sales rose 2.8% on a like-for-like basis in May, compared with a 0.4% drop in the year-ago period, driven by "better weather and the bank holiday effect" that encourage shopping across multiple categories, according to data by the British Retail Consortium. Sales jumped 4.1% on a total basis in May, marking the highest increase the sector has experienced since January 2014, excluding Easter distortions. However, BRC CEO Helen Dickinson warned that the retail landscape "remains extremely challenging" as growth continues to be "very low" when compared with historical figures.

The day ahead

Early morning futures indicators pointed to a mixed opening for the U.S. market.

In Asia, the Hang Seng was up 0.53% to 31,259.10, while the Nikkei 225 rose 0.38% to 22,625.73.

In Europe, around midday, the FTSE 100 rose 0.37% to 7,716.06, and the Euronext 100 shed 0.14% to 1,061.64.

On the macro front

The bank reserve settlement report, the MBA mortgage applications report, the international trade report, the productivity and costs report, the EIA petroleum status report and Treasury STRIPS are due out today.

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