National Post from Toronto, Ontario, Canada • 8

8 Thursday, June 6, 1991 The financial post mimes mmhl Requiem for a eavyweight Simpsons stores to become Sears outlets: Oakville Place Mall Erin Mills Town Centre Markville Centre Fairview Mall Woodbine Shopping Centre Burlington Mapleview Mall Bay stores to become Sears outlets: Scarborough Town Centre Yorkdale Shopping Centre Simpsons stores to become Bay outlets: Yorkdale Shopping Centre Cedarbrae Mall Hillcrest Mall Sherway Gardens Warden Woods Brampton Shopper's World Yonge Queen Scarborough Town Centre Sears store to become Bay outlet: Burlington Mall "The downtown store was unique, but the suburban stores didn't have much in common with it and were closely aligned with Bay stores," retail consultant Len Kubas said, adding Simpsons was also plagued with a number of locations not suited for an upscale outlet. Last year, HBC accelerated Zellers' expansion by purchasing the 51-store Towers Department Stores Inc. chain from Oshawa Group Inc. for $181.5 million. The Bay will probably now have a split personality with a number of stores the Markham, Burlington, and downtown Toronto flagship carrying upscale merchandise.

John Williams, president of John C. Williams Consultants Ltd. in Toronto, said the Bay will have little difficulty merging Simpsons' flagship store into its operations because it already operates several large, upscale outlets. with files from Canadian Press Simpsons stores outside of Montreal and Toronto. Then two years ago, it converted four Montreal stores to Bay outlets.

That reduced the Simpsons chain to 12 stores in metropolitan Toronto before the opening of two new stores last year, in Mark-ham, Ont, and Burlington, Ont. "We haven't been very successful with Simpsons in the Toronto area over the past few years," said Gary Lukassen, chief financial officer for Hudson's Bay. "It's been a major money loser and with the recession, there was no sign things were going to turn around." Analysts say a big reason for the chain's difficulty was the fact consumers were never clear about Simpsons' market position. While a multi-million-dollar renovation created a glitzy image at Simpsons' flagship store in downtown Toronto much of which will be retained in the conversion the chain's suburban outlets looked much the same as their Bay counterparts. By Mark Evans Financial Post THE DECISION by Hudson's Bay Co.

to abandon its 14 Simpsons stores marks the end of an ambitious strategy that would have given the company strong players in the upper, middle and lower ends of the retail market. The retailer announced yesterday it plans to convert eight Simpsons stores to Bay outlets and sell five others to Sears Canada Inc. for an undisclosed amount. A separate deal has been reached with the landlord of the remaining Simpsons store to sell the lease to Sears. The move, which had been rumored for several weeks, confirmed analysts' views that the formula HBC successfully used at the mid-priced Bay and discount Zellers chains was a failure at Simpsons, which it had repositioned to serve the upscale consumer.

In the mid-1980s, HBC began to close down Investors cheer on Hudson's Bay stock 7 By Mark Evans 21M Hudson's Bay Co. snare price, weekly close on ist Financial Post INVESTORS in Hudson's Bay Co. reacted enthusiastically to the retailer's decision to put the ailing Simpsons chain out of its misery. HBC shares jumped $1V6 to a 52- week high of $33 on the Toronto June 5 Lj 1 $3358 25 20 piF 15 I I I i I I I I 'I I I I I I I I 1990 91 Sourar RkiIv i in in Stock Exchange yesterday on news the company plans to convert eight Simpsons stores to The Bay name and sell five others to Sears Canada Inc. Analyst Bill Chisholm of Loewen Ondaatje McCutcheon Co.

Ltd. said investors are pleased HBC management has addressed a problem area that will no longer be a drain on HBC's bottom line. "As it was, Simpsons was not profitable and didn't have any prospect of becoming an attractive retail venture," he said. "The Bay had moved, to all practical purposes, to merge with Simpsons into one company, except for different names." Impressive jump Hudson's Bay stock has enjoyed an impressive 49 jump since the company spun off its real estate arm, Markborough Properties last summer. Chisholm said the shares are adequately priced in the near term, but he sees room for growth as the economy strengthens.

In the latest three-month period ended April 30, HBC posted a net loss of $23.1 million, or bit a share, compared with a net loss of $6.6 million of 19t a year earlier. Sales climbed 6 to $1.1 billion. Shares of Sears Canada which picked up five Simpsons and two Bay locations for an undisclosed amount, closed down Vfc to close at $12. While the Toronto-based retailer increased its market presence in Toronto, Chisholm said the stock has gotten ahead of itself because the company is not as strong as other retailers at this stage in the economic cycle. Sears posted a net loss of $25.8 million, or 31tf a share, for the three months ended March 31 compared with a net loss of $10 million or 120 a year earlier.

Sales dipped 14 to $816.9 million. ii Canadian manufacturers with an eye toward expansion are looking closely at Port Huron and St. Clair County. Our strategic location puts you within an overnight's drive of the largest concentration of industrial and consumer markets in North America the Big Three automotive manufacturers are little more than an hour away. Our skilled labor force, attractive business incentives, prime industrial sites and competitive energy rates are raising a few eyebrows throughout Ontario, too.

To learn more, call now. Or FAX your letterhead to us at (313) 982-9531. Ask for "The Bottom Line Facts" about Port Huron and St. Clair County. The information is free, what you learn could be worth millions.

rf-. PORT HURONSI CLAIR COUNTY See pages 40 41 International Trade Office 511 Fort St, Port Huron, Michigan 48060 U.S.A. 1.