Hudson’s Bay owners returned to the Court on Friday arguing that a BC billionaire does not have the necessary cash to launch a new retailer.
Ruby Liu wants to buy 25 more leases for $ 69.1 million of the bay to open a new department store that bears his name. The court already approved a separate purchase of three bay leases in shopping centers that it owns for a total of $ 6 million.
The bay wants to sell the leases because it will help the retailer to pay some of the approximately $ 1 billion that must be creditors. He says that the largest Liu agreement is the “last way to carry out any value for the 98 leases of the company.”
Hudson’s Bay has argued that Liu has the money he will need to launch and direct a department store. The retailer accused the owners of painting their business plan and experience as insufficient because it is of their financial interest in leases to return to them.
However, prominent owners, including Cadillac Fairview, Oxford Prpeties and Ivanhoé Cambridge, are vehemently oppose for sale and, for a second consecutive day, they were in court asking for a judge who does not force them to accept Liu as a tenant.
The owners say that they should not have to let Liu do not move because it does not have the experience or the team needed to launch a new company at the scale you want. They also say that their budget to renew and open some of the stores in six months is not realistic.
They opened their Friday presentations by attacking the $ 400 million that says it will spend on the new chain.
The problem, said a lawyer from the owner of Bay, Kingsett Capital, is that “Mrs. Liu does not have $ 400 million or nowhere close to $ 400 million.”
That money is “non -existent,” said Matthew Gottlieb. “We say that the alleged financial commitment is no commitment. It is just a showcase. It is not processable, it is not enforceable.”
He came to that conclusion because Liu will not personally guarantee that $ 400 million and much of their remaining money are linked to international companies that have not signed binding commitments to support their new company.
The company Liu wants to use to buy the bay is total property by Techion Global Investments Ltd., which is incorporated into the British Virgin Islands, according to judicial documents presented by the Gottlieb firm.
He is also co -owner of Central Walk (Barbados) Company based in Barbados Ltd. with his brother. Gottlieb told court that all funds are carried out in Hong Kong and Singapore, not in Canada. Liu confirmed this during the previous procedures that were not open to the public, according to the same documents.
“There are no funds in a Canadian bank for $ 400 million or anything close,” he argued.
Malls losing money
Liu has said that not only has the money, but also has three BC shopping centers that can be a source of financing.
Liu has 70 percent stakes in Woodgrove Center in Nanaimo and Mayfair Shopping Center in Victoria, as well as a 30 percent participation in Tsawwassen Mills in Delta, Kingsett said. His brother has the other 30 percent in the first two shopping centers and his sister has the remaining interest of 70 percent in Tsawwassen Mills in a trust for Liu and his brother.
Gottlieb argues that none of the shopping centers can be counted for cash because they collectively lost around $ 19 million in 2023 and 2024.
If their other companies had compiled interest in the loans they made to the shopping centers, Gottlieb said the shopping centers would be insolvent.
While he mentioned that Liu has told the owners that he has an attempt to buy Mayfair, Gottlieb said he refused to produce a copy.
Gottlieb’s arguments were followed by presentations by Linda Wlessiere, lawyer of the owners Ivanhoé Cambridge, Morguard Investments and Westcliff Management.
Wassiere framed the LIU team is gathering for the retail company as inexperienced and, therefore, is not suitable for administering a business in the properties of its customers.
He pointed out that the CEO of the Liu company obtained the main work in May after 15 years of being a real estate agent. Liu’s human resources director was one of the first children’s educators before joining the Liu team and his vice president to obtain supervisory customs documents, said Wlessiere.
Liu was not willing to hire retail professionals that Hudson’s Bay had to offer to reduce the purchase price to bring a more competent staff, said Galessiere.
While Liu previously told the court that a trio of former bay workers would join his team, Wlessiere said that each one “admitted frankly” that they have no contract with the billionaire during an interrogation earlier this month.
For owners, the incentive to win this judicial battle is high. The contracts that Liu wants “are not its average leases,” said Wlessiere. They are the largest spaces that the owners have and come with attractive terms of rent, access to the shopping center inside and outside and a proximity to parking.
If the bay cannot sell the leases to Liu, the owners will recover the spaces. They can rent them to those who want, probably for much more than what the bay paid, or even rebuild the sites.
They are not the only critics of the treatment. Bay Provider Restoure Capital says that every month that the agreement does not approve it costs more money and decreases the possibility of recovering what is due.
Experienced team necessary
But perhaps the most powerful objector is Álvarez & Marsal, an independent monitor designated by the court to review the protection activity of the bay creditor.
Álvarez and Marsal’s lawyer, Sean Zweig, told the court on Friday that when Liu was selected to buy leases in May, the monitor was hope that the owners would see the sale as a potential benefit, so he decided to prove the transaction.
Then, the meetings between Liu and the owners were “very bad” due to their “lack of preparation.” While the monitor believes that he can meet all his financial obligations, he expected Liu to have a commercially viable business plan, but “that has not been the case,” Zweig said.
He claimed that he has accumulated a team without the necessary experience for the “monumental” task of opening 28 stores and pointed out that, in time since the monitor he met her, she dropped her original financial advisor and changed legal equipment three times.
As a result, he said that there is a “very real risk” that Liu will not be able to fulfill his plan.
The hearing wrapped late without Judge Peter Osborne making a decision on the leases. Liu left the Palace of Justice flanked by a entourage of personnel and followers in shirts with his name.
When asked what he does if he loses the case, he told reporters that he thinks he will win.
