Hudson’s Bay has agreed to sell about half of its European business to Austria’s Signa Holding in a deal that will bring together two major German department store chains, according to media reports on Wednesday.
The agreement, described as a “proposed merger of equals for the European department store business” by German magazine WirtschaftsWoche, was signed by both parties on July 3, the weekly reported.
Under the deal, a joint venture will be created consisting of Kaufhof, the German department store chain owned by Canada-based Hudson’s Bay, and Karstadt, which is owned by Signa, the magazine said.
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Signa will hold slightly more than half of the entity and will manage the operating business, it added.
In a separate article, the Wall Street Journal said Hudson’s Bay would receive 1.1 billion euros ($1.69-billion) from Signa as part of the transaction. Signa, in turn, will assume 750 million in debt, the paper said.
Hudson’s Bay declined to comment. A spokesman for Signa was not immediately available for comment.