Hudson’s Bay Co. says it is in talks with European retailer Signa Holding GmbH regarding a potential joint venture.
The Canadian retailer says it has signed a non-binding letter of intent with respect to the exploration of the idea.
The retailer denied reports in the Financial Times and Wall Street Journal that it had a deal to sell half its European retail business to Austrian-based Signa, which owns rival retailer Karstadt.
In Europe, HBC owns the Kaufhof department store chain in Germany and Belgium, Lord & Taylor and has plans to open HBC stores in the Netherlands and other countries.
In response to the media reports, HBC said it has not signed a binding agreement to sell or combine its European business or properties.
It noted there could be no assurance that the talks will lead to a transaction.
Signa made an unsolicited bid late last year for HBC’s German operations, but withdrew the offer earlier this year after it was rejected by the HBC board.
In a press release Friday, HBC said any potential deal would be subject to board and third party approval. HBC has been under pressure from investors to reduce its debt amid lacklustre sales.