Hudson’s Bay Company has announced the sale of its Gilt member-based digital shopping business to e-commerce firm Rue La La. No financial details of the deal were disclosed, although some reports pegged the price at under $100m.
Hudson’s Bay acquired Gilt, which offers online flash sales, in 2016 for $250m. However, it failed to revive the latter’s fortunes, and incurred a $63m write-off in fiscal 2017 “due to further deterioration in operating results.”
Rival Rue La La helps its members “discover” beauty and home décor products, apparel and accessories, as well as exclusive destinations and experiences. The two companies will now operate under the newly-formed Rue Gilt Groupe, and will serve more than 20 million members, with a focus on young, affluent, fashion and brand-conscious consumers. Both brands will continue to operate independently.
Rue La La said the deal brings together “two complementary lifestyle brands into a multi-brand growth platform”, adding that both companies will benefit from merchandising scale and efficiencies. Rue La La also plans to hire more than 150 staff to run the Gilt business across the US.
Mark McWeeny, CEO of Rue La La, noted: “Through the acquisition of Gilt and our evolution into a multi-brand platform, we are equipped for an acceleration in growth, innovation and profitability. Together with Gilt, Rue La La looks forward to increasing our presence and offering the attainable luxury and best-in-class experience that today’s customers demand.”
