Target aims for Canada with $1.83 billion takeover of Zellers

Zellers stores across Canada will disappear in a couple of years, as major U.S. retailer Target moves in. Target is spending $1.83 billion to buy up the leasehold interests in 220 Zellers stores from the storied Hudson’s Bay Company. The deal appears to be a lucrative one for U.S. owner Richard Baker who bought the […]

Zellers stores across Canada will disappear in a couple of years, as major U.S. retailer Target moves in.

Target is spending $1.83 billion to buy up the leasehold interests in 220 Zellers stores from the storied Hudson’s Bay Company.

The deal appears to be a lucrative one for U.S. owner Richard Baker who bought the Hudson’s Bay Co. in 2008 for just $1.1 billion. “This transaction provides attractive long term value and will allow us to invest substantial capital into our department store and specialty store businesses to continue to drive growth,” said Baker in a release. Baker’s company NRDC Equity Partners also owns high-end fashion retailer Lord & Taylor.

Though Target said the Zellers brand won’t disappear immediately, the deal is the first step in a plan to open between 100 to 150 Target stores by 2013.

According to the Globe and Mail, the remaining Zellers stores will be auctioned off to other, potentially international retailers like Kohl’s and J.C. Penney.

Target, which helped coin the phrase “discount chic,” has long been exploring opportunities north of the border.

However it hit several roadblocks that run the gamut from unattractive real estate locations for potential stores to the economic slowdown that reined in consumer spending.

Target said that under the agreement Zellers will continue to lease the locations from Target and run them as Zellers stores “for a period of time.”

Brands Articles

Millennial-ized market means Kraft Dinner is now KD

Low-risk name change drives brand update across 27 products

Jaguar Land Rover picks Mint

Toronto shop becomes automaker's first agency of record in 15 years

Toronto yoga junky finds her Flow for online contest

Bottled water brand wraps its social media contest after finding The Chi Junky

Working myself out of a job (Column)

In an ideal world, a good company may not need a PR firm. In reality...

Corby dedicates 50% of digital spend to programmatic

Booze brands make a big shift online with new media and platform partners

Shopify to spend more to grow ahead of holiday season

Despite Q2 loss, revenue nearly doubles from a year ago

Diageo launches Jeremiah Weed in Canada

Brand takes 'irreverent approach' to connect with millennials

Amazon expected to become top U.S. clothing retailer

Will ecommerce giant become the king of clothing in Canada?

Weak dollar not all bad news for retailers (Survey)

Canadians are rethinking their cross-border shopping trips