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Hudson’s Bay Company announces agreement with Target Corporation for the sale of certain Zellers real estate leases for C$1.825 billion

TORONTO, January 13, 2011 – Hudson’s Bay Company announced today that its subsidiary, Zellers Inc., has reached an agreement with Target Corporation for C$1.825 billion for the sale of up to 220 leasehold interests that are currently operated as Zellers stores.

As part of the transaction, Zellers Inc. will sublease the properties back from Target Corporation upon closing and continue to operate them as Zellers stores for a period of time.  Target Corporation expects to open 100 to 150 Target stores throughout Canada in 2013 and 2014.  Additionally, it is anticipated that a select number of Zellers locations will be assigned to other retail enterprises.  Zellers Inc. will continue to operate a portfolio of certain Zellers stores in specific communities across the country.

According to Richard Baker, Governor, Hudson’s Bay Company, “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.”

The sale of these leasehold interests is estimated to create over 20,000 net new jobs in Canada and has the potential to generate over $1.5 billion in Canadian economic activity through the renovation of the Zellers locations.  The entry of Target Corporation into the Canadian market will provide a broader retail product offering to Canadian consumers.

About Hudson’s Bay Company
Founded in 1670 and based in Toronto, The Hudson’s Bay Company is a conglomerate that operates the Bay, a major department store, Zellers, a mass merchandise format, Home Outfitters, a kitchen, bed and bath specialty store, and value-priced Fields stores.

For more information:
Freda Colbourne
416 560-7794