The news at a glance

Retail: Hudson’s Bay to buy Saks

Saks Fifth Avenue “is going Canuck,” said Tiffany Hsu in the Los Angeles Times. The luxury retail chain is selling itself to Hudson’s Bay, the Canadian department store brand, for $2.9 billion. Hudson’s Bay, which already owns department store chain Lord & Taylor, will pay $16 a share to buy New York City–based Saks, Inc.—“a 30 percent premium to Saks’s stock price on May 20, just before speculation emerged about a possible acquisition.” Both companies’ boards have okayed the deal, but it still needs approval from shareholders and regulators.

The Saks acquisition “would create a behemoth in the retail world,” said Peter Lattman and Stephanie Clifford in The New York Times. The combined company will own 320 stores, including 179 full department stores. Hudson’s Bay edged out “a number of other Saks suitors,” including Kohlberg Kravis Roberts and the Qatar Investment Authority. While many department stores have struggled, largely because of Internet competition, Saks “continues to benefit from luxury shoppers who, after closing their wallets during the recession, have come back in force since.” In 2012, its sales rose 4.4 percent, reaching $3.15 billion, and company executives said Saks had continued to rake in cash from foreign tourists.

The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

Marketing: Ad giants agree to merge

Two marketing giants will join to create the world’s largest advertising company, said Kristen Schweizer and Marie Mawad in Bloomberg.com. Paris-based Publicis Groupe and New York City–based Omnicom Group agreed last week to merge, creating “the world’s largest advertising company, with $23 billion in revenue.” Owners hope the merger will give them “more clout to negotiate for their clients better ad rates.” But the companies’ “overlap and potential market share” may attract regulatory scrutiny. Together, Publicis and Omnicom account for “41 percent of total spending by the top 10 media agencies in the world.”

Power: JPMorgan settles manipulation charges

JPMorgan Chase will “pay $410 million to settle allegations of power-market manipulation,” said Scott DiSavino in Reuters.com. The settlement announcement came after federal regulators accused JPMorgan’s commodities trading unit of engaging in “manipulative bidding strategies” in the electricity market in California and the Midwest. The bank, which recently said it would exit the commodities business, had earlier vowed to fight the charges.

Tech: Facebook shares near IPO price

Facebook shares are bouncing back, said Evelyn M. Rusli in The Wall Street Journal. More than a year after “its bungled initial public offering,” the social network’s stock turned a corner last week and hit $38 a share, matching its May 2012 IPO price. The social networking site’s stock has been surging in recent months, “powered by increasing ad sales and signs that Facebook is finding its footing on mobile devices.” The move toward mobile “culminated in the second quarter of this year, when Facebook blew out expectations on the top and bottom line.”

Lawsuits: Ex-employees sue Apple for back pay

Two former Apple workers say the company is shortchanging thousands of employees, said Michael Liedtke in the Associated Press. The ex-employees filed a federal suit against the iPhone-maker last week and are seeking class-action status. “The case hinges on accusations that Apple requires store workers who are paid by the hour to submit to searches of their bags and other personal belongings as an anti-theft measure before they are allowed to leave the premises.” The plaintiffs say the “unpaid detention periods” add up to hours each year, and thousands of dollars in withheld wages.