Hudson’s Bay Co and Germany’s Metro Group said yesterday they’ve reached a definitive agreement for HBC to acquire Galeria Kaufhof and its Belgian subsidiary Inno for $3.9B. The deal, expected to close by the end of Q3, includes 103 Galeria Kaufhof stores in Germany, 16 Sportarena stores, 16 Galeria Inno department stores in Belgium, plus logistics centres, warehouses and other properties, such as Galeria Kaufhof's HQ in Cologne. HBC will continue to operate Galeria Kaufhof, Inno and Sportarena under their current brand banners.

The Galeria Kaufhof acquisition will give HBC 464 retail locations worldwide, eight banners—including Saks Fifth Avenue and Lord & Taylor—and $13B in revenue. HBC chief Richard Baker said the deal “demonstrates our proven growth formula in action, and it is the right investment and the right time.” He noted his firm had been “carefully surveying the European retail landscape for many years” for potential expansion opportunities, and watched Galeria Kaufhof build on its “exceptional real estate” to become Germany’s top department store. The deal will see the Saks banner introduced in Germany and Belgium.