CEO of Saks Parent to Step Down
Helena Foulkes sold businesses and helped pave the way for Hudson’s Bay to go private
Hudson’s Bay Co.’s chief executive is leaving the company, following a deal it reached last week with shareholders to go private.
Helena Foulkes joined the parent of Saks Fifth Avenue from CVS Health Corp. CVS -2.33% in 2018 and helped streamline the retail conglomerate by selling businesses and improving operations. Ms. Foulkes, 55 years old, will depart on March 13. Richard Baker, Hudson’s Bay executive chairman, will become CEO.
Shareholders last week approved a transaction with an investor group that includes Mr. Baker to take the company private for 11 Canadian dollars a share, or roughly US$8.25. The transaction closed on Tuesday, the company said.
Mr. Baker is a real-estate executive who entered the fashion business in 2006 when his investment firm paid $1.2 billion for Lord & Taylor. He built a conglomerate that included the Hudson’s Bay retail chain in Canada, Saks Fifth Avenue, German departmentstore chain Galeria Kaufhof and online flash-sale retailer Gilt Groupe.
Most of those businesses were later sold to focus on improving the operations of Saks and Hudson’s Bay, which were struggling in the face of competition from online upstarts and other rivals.
Marketing, public relations and other shared functions were decentralized, allowing the businesses to operate independently, according to a person familiar with the situation. From here, the company will be structured more like a holding company with the presidents of Saks and Hudson’s Bay running their respective businesses, the person said.
Department stores have had a particularly hard time reinventing themselves in a world where shopping has shifted online. Macy’s Inc. plans to close 125 stores over three years and recently laid off about 2,000 employees. And Barneys New York filed for bankruptcy last summer, though its brand is living on in departments located in some Saks stores.
Hudson’s Bay in 2017 became the target of activist investor Land & Buildings Investment Management LLC, which urged the company to maximize the value of its real estate by turning its retail space, including its Saks Fifth Avenue flagship in Manhattan, into office towers, hotels or other types of boutiques.
Following the departure of then-CEO Gerald Storch in 2017, Hudson’s Bay hired Ms. Foulkes, who had spent more than 25 years with CVS, most recently as president of its pharmacy division. Ms. Foulkes was a key part of CVS’s decision in 2014 to discontinue sales of tobacco products.
At Hudson’s Bay, Ms. Foulkes jettisoned Gilt, Kaufhof and other European operations, as well as Lord & Taylor, paving the way for the company to go private.
The divestitures raised C$2.4 billion in proceeds, of which C$1.6 billion was used to pay down debt.
Total revenue slipped less than 1% to C$5.55 billion in the nine months that ended Nov. 2. The net loss widened to C$935 million from C$823 million a year earlier.
Mr. Baker has said it would be easier to pull the company out of its slump away from the public eye.
“This is the time in retailing to reinvent, to upgrade our presence online and in stores, and create a better, more exciting company. Being private, we’ll be able to do that,” he said in an interview last week.
With Mr. Baker’s strong real-estate background, the company is expected to look at new ways to unlock value from its properties going forward, according to the person familiar with the situation.