Germany's two major department store chains Kaufhof and Karstadt have sealed a merger to salvage their operations amid fierce competition from e-commerce players. The owners of Kaufhof and Karstadt — Canada's Hudson's Bay and Austria's Signa Holding — have announced that they've sealed a "merger of equals" to combine their European retail and real estate assets, with Signa now owning 50.01 percent in the joint venture and Hudson's Bay holding a stake of 49.99 percent. In a parallel transaction, both companies will form a 50-50 joint venture focused on Hudson's Bay's German property assets, with Signa taking a 50 per cent stake in that business. The merger of Germany's Galeria Kaufhof and Karstadt will form Europe's third biggest department store chain, behind Spain's El Corte Ingles and Britain's Marks and Spencer.

HBC press release on Kaufhof & Karstadt merger