Target is getting bigger and bigger – having recently added fresh produce to it’s already fully stocked stores the U.S. retailer has announced it is buying Canadian discount retail chain Zellers from Hudson’s Bay Co. for $1.8 billion, MSN reports. This marks Target’s first expansion into countries other than the U.S.
According to a statement released by the retailers, the terms of the deal state that Zellers locations will continue to operate under the brand’s name for “a period of time,”. However, by 2013 to 2014 Target plans to open 100 to 150 Canadian locations and assign the rest of Zellers’ current network of 220 stores to other retailers.
“This transaction provides attractive long-term value and will allow us to invest substantial capital into our department store and specialty store businesses to continue to drive growth,” HBC governor Richard Baker said in a release.s
The acquisition and expansion will not only benefit Target but the Canadian economy and residents as well with the estimated creation of over 20,000 net new jobs and the potential to generate over $1.5 billion in Canadian economic activity. In the statement Target anticipates the creation of thousand jobs in Canada: initially in the construction industry through renovation works, and eventually in the stores themselves, as a typical U.S. Target employs between 150 to 200 people, meaning tens of thousands of jobs will be created.
Target says its arrival will benefit the areas in which it operates as the company has a commitment to donate more than 5% of its income to support local initiatives.
“We are very excited to bring our broad assortment of unique, high-quality merchandise at exceptional values, and our convenient shopping environment to Canadian guests coast to coast,” said Gregg Steinhafel, chairman, president and chief executive officer of Target Corporation.