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Signa to buy half of Hudson's Bay Europe; Rockport to sell assets to Charlesbank


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Signa to buy half of Hudson's Bay Europe; Rockport to sell assets to Charlesbank


* Canadian department store chain Hudson's Bay Co. agreed to sell about half of its European business to SIGNA Holding GmbH for €1.1 billion, The Wall Street Journal reported, citing people familiar with the situation. Austrian real estate firm Signa will buy half of the Hudson's Bay's European business, including Galeria Kaufhof, retail chains in Belgium and the Netherlands and Saks Off 5th stores in Europe. Signa will also reportedly buy half of Hudson's Bay Europe's real estate company.

* The Rockport Co. LLC plans to sell the company to CB Marathon Opco LLC after failing to receive a competing bid against the Charlesbank Capital Partners LLC affiliate ahead of its planned auction of the business on July 10. The footwear retailer, which filed for Chapter 11 bankruptcy protection in May, will seek approval from Delaware's bankruptcy court to complete the sale of its global wholesale assets, e-commerce platform, and retail operations in Asia and Europe to private equity firm Charlesbank. The struggling shoemaker also began winding down its North American retail operations and expects it to complete no later than July 31.


* Investment firm Gordon Brothers Group LLC bought privately held U.K. fashion brand Bench Global Ltd. for an undisclosed amount, following the relaunch of its own Wet Seal fast-fashion arm into e-commerce. Gordon Brothers plans to re-establish Bench's e-commerce and wholesale presence in Europe as well as maintain the streetwear company's partnership with Freemark Apparel Brands Group in North America.

* Superdry PLC reported its third consecutive year of double-digit growth in revenue and underlying profit before tax, reflecting a strong performance in its wholesale and e-commerce businesses. For the full year ended April 28, the U.K. apparel retailer posted an underlying basic EPS of 93.6 pence, a 10.8% year-over-year increase from 84.5 pence in 2017 but slightly below the S&P Capital IQ mean consensus estimate for normalized EPS of 94 pence. Superdry also distributed a special dividend of 25 pence per share in addition to its full-year ordinary dividend of 31.2 pence per share "as a result of continued strong cash generation."

* Authentic Brands Group completed its acquisition of bankrupt footwear company Nine West Holdings Inc. after it won the auction for the shoemaker's intellectual property. ABG plans to assume all the licensing partnerships and marketing activities for the Nine West and Bandolino brands, which will increase the company's footwear and accessories portfolio by more than $2 billion in global retail sales. The company also appointed Marc Fisher Footwear, which manufactures shoes for brands such as Guess and Tommy Hilfiger, to operate Nine West's footwear category, while accessories producer Signal Products will operate its handbag and SLG arm.


* Ryohin Keikaku Co. Ltd. posted a GAAP EPS of ¥363.66 for the first quarter of 2019, up from ¥297.73 in the year-ago period and beating the S&P Capital IQ consensus GAAP EPS estimate of ¥336.52. For the three-month period ended May 31, the operator of retail chain Muji reported that revenue grew 9.7% year over year to ¥106.52 billion from ¥97.14 billion in 2017. Separately, Ryohin Keikaku said it will set up a subsidiary of its Muji chain in Switzerland, which will be a part of the stores regional headquarters in Europe, Muji Europe Holdings Ltd.


* Rakuten Inc. reached a final agreement to acquire LOB Inc., a Tokyo-based advertising platform developer and provider with a capital of ¥30.5 million, for an undisclosed sum. The Japanese internet service provider will use LOB's technical expertise and development capabilities to develop a global advertising platform.


* Asda Stores Ltd., the Walmart Inc.-owned supermarket chain slated to be merged with J Sainsbury PLC, said Rob McWilliam will return to the company as its CFO, succeeding Alex Russo, who will leave in July to join homeware retailer Wilko. McWilliam left Asda in 2012 to head the finance and consumables division of Inc.'s U.K. arm. In addition, Asda's vice president and commercial finance director, John Fallon, was promoted to deputy CFO.

* J Sainsbury PLC reported a slight increase in sales of 0.8% year over year for the 16 weeks ended June 30, reflecting the £150 million investment the company made in March to reduce its prices. In a call with analysts to discuss the company's first-quarter trading update, CFO Kevin O'Byrne said the price cuts resulted in strong volume responses and "encouraging changes" in items per basket at Sainsbury's. In its first trading update since announcing the deal with Walmart Inc.-owned British rival Asda Stores Ltd., the U.K. supermarket operator reported that like-for-like sales, excluding fuel, edged up 0.2% year over year.

* Australian retailer Woolworths Group Ltd. entered an alliance with Caltex Australia Ltd covering convenience store and loyalty operations, in addition to signing a new 15-year fuel supply deal. The tie-up will see the companies collaborate on the development and launch of a convenience store offering under Woolworths' Metro banner at up to 250 Caltex service station locations over the next six years, with 50 of the outlets planned in the next two years.

* Japanese retailer Seven & i Holdings Co. Ltd. reported a surge in profit for the fiscal first quarter, driven by strong sales at its overseas convenience stores. For the three months ended May 31, net income attributable to the owners of the parent jumped 27.5% year over year to ¥42.89 billion from ¥33.63 billion, surpassing the S&P Capital IQ consensus estimate of ¥42.42 billion. Seven & i also reaffirmed its forecast for the fiscal year ending Feb. 28, 2019, expecting to record attributable net income of ¥210 billion and net income per share of ¥237.41.

* Associated British Foods PLC maintained its full-year outlook as increased sales at retail chain Primark offset a sharp decline in sugar revenue. In a trading update for the 40 weeks ended June 23, AB Foods said group revenue was 3% ahead of the same period in 2017 at constant currency rates and 2% at actual exchange rates. Sales at Primark were up 6% for the fiscal year-to-date at constant currency rates and 7% at actual exchange rates, while its sugar business saw revenue decline 17% in the fiscal third quarter. In late-morning trading in London, AB Foods shares were down 112 pence, or 4.1%, at 2,605 pence.


* Barnes & Noble Inc. fired its CEO, Demos Parneros, over violation of company policies, as advised by the retail bookseller's law firm Paul Weiss Rifkind Wharton & Garrison LLP. The New York-based company noted that Parneros, who will not receive any severance pay and will no longer be a director of the retailer's board, was not terminated due to any disagreement regarding Barnes & Noble's financial reporting, policies, practices or any possible fraud. Barnes & Noble added that it will begin a search for a new CEO but has appointed a leadership group to share the duties of the role until a replacement is named.


* Hong Kong's retail sales by value grew 12.9% year over year to HK$40.5 billion in May as local consumer sentiment in the city remained positive and inbound tourism continued to increase, according to a report by Hong Kong's Census and Statistics Department. The growth was just slightly ahead of the 12.3% year-over-year increase in retail sales value confirmed for April.

The day ahead

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

In Asia, the Hang Seng was down 0.21% to 28,182.09. The Nikkei 225 declined 0.78% to 21,546.99.

In Europe as of midday, the FTSE 100 added 0.60% to 7,618.39, and the Euronext 100 was up 0.94% to 1,053.54.

On the macro front

The Challenger job-cut report, the ADP employment report, the jobless claims report, the ISM non-manufacturing index, and the EIA petroleum status report are due out today.

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