The Hudson’s Bay Company, owners of Saks Fifth Avenue, announced the department store’s website would be a completely independent business from its stores once it had raised USD500 Million. Saks brick-and-mortar stores will function as an entity known as SFA, owned by HBC.
According to HBC, venture capital firm Insight Partners invested USD500 Million in order to take a minority stake in Saks.com. The change allows the two parts of the business to be “better able to appropriately plan for and invest in their respective service models,” said HBC.
Amid the ongoing pandemic, people have turned to online shopping, even within the luxury market. Consumers have purchased everything from high-end handbags to jewelry, all from the comfort of their own home.
Saksfifthavenue.com produces around USD1 Billion in sales annually, making it a contender to become a public company. Mytheresa, a luxury website that went public in January made only half of that in sales and still experienced a rapid rise in its stock.
Marc Metrick, Saks Fifth Avenue President and CEO, will now act as CEO of the Saks e-commerce company as well as a member of its board of directors.
HBC’s CEO, Richard Baker, said that “Luxury e-commerce is poised for exponential growth, and as a stand-alone digital company with an existing strong position in luxury, Saks is primed to win significant market share. With this move, we are redefining the luxury shopping ecosystem.…The team’s fashion expertise combined with a renewed digital focus will provide customers with an unmatched shopping experience. Furthermore, this transaction reinforces HBC’s ability to unlock significant value within our company’s assets. We are delighted to partner with Insight Partners, a firm globally recognized for its ability to scale Internet, software and e-commerce leaders.”
Saks and SFA will continue to work together to execute a seamless customer experience. All returns, exchanges and SaksFirst credit cards will be valid online and in stores.