* Department store operator raising less than planned
* Offering at C$17 a share set to close on Monday
* Shares ebb as trading begins on "when-issued" basis
By Euan Rocha and Allison Martell
TORONTO, Nov 20 Canada's Hudson's Bay Co
is set to raise C$365 million ($367 million) in its
initial public stock offering, well below the department store
operator's original target of about C$400 million.
HBC has priced the offering of 21.48 million shares at C$17
apiece - at the bottom of the company's already lowered range of
C$17 to C$18. The offering price pegs its market capitalization
at about C$2 billion.
The shares began trading on the Toronto Stock Exchange on
Tuesday on a "when-issued" basis, sliding 1.5 percent from the
offer price to C$16.75. The stock is trading under the symbol
"HBC," the same as it did before going private in 2006.
Trading volume in the stock was significant, with more than
3 million shares changing hands by 1400 ET, making HBC one of
the 10 most actively traded stocks on the TSX.
"This gives you an indication of where people would buy and
sell the stock today ... But it is only the more speculative
people trading in the market right now, not a full complement of
players," said one trader, who does not own any position in the
stock but asked to remain unnamed.
All trades in the stock executed ahead of the official close
of the offering have to be matched and settled, as and when the
offering officially closes. If the offering fails to close for
any reason, all these trades will be considered as null and
HBC said in a statement late on Monday that the TSX has
conditionally approved its listing. The stock is slated to start
trading officially on the anticipated closing date of Nov. 26.
The company, which owns two venerable chains, Lord & Taylor
in the United States and Hudson's Bay in Canada, originally
aimed for an offering price of C$18.50 to C$21.50 a share.
The department store operator faces stiff competition. In
the United States, Lord & Taylor competes with a resurgent
Macy's Inc ; in Canada, HBC faces competition from Target
Corp and other U.S. companies that are keen to expand
their retail footprint.
Founded in 1670, Hudson's Bay was a fur trading business
long before it operated department stores, running trading posts
across what is now Canada. It went private in 2006 as shoppers
flocked to specialty retailers and U.S.-based heavyweights such
as Wal-Mart Stores Inc.
NRDC Equity Partners, controlled by U.S. real estate
investor Richard Baker and his family, bought out HBC's other
investors in 2008, and integrated it with Lord & Taylor, which
operates 48 stores across the United States.
HBC said the IPO will result in gross proceeds to the
company of about C$250 million, and proceeds to selling
shareholders of about C$115 million. Net proceeds to the company
will be used to repay debt, HBC said.