Private equity firm Catalyst Capital is to acquire 10.05% of the outstanding stock in Hudson's Bay Company (HBC) for CAD187m in a move that could block a deal to take the Canadian retailer private by its executive chairman.

Catalyst says it has received and accepted 18.5m shares in HBC at a purchase price of CAD10.11 per share in cash. The firm expects the purchase to be completed by tomorrow (22 August). 

The move follows an offer by Catalyst earlier this month to purchase up to 19.8m common shares in HBC for CAD10.11 each, upping an initial offer in July proposing to purchase up to 14.8m common shares of HBC for CAD10.11 each. 

The Catalyst bid came after HBC's board formed a special committee last month to review and evaluate a proposal from a group of HBC stakeholders to privatise the company at a price of CAD9.45 per share, payable in cash.

The group submitting that proposal are all linked to Richard Baker, governor and executive chairman of HBC, Rhône Capital, WeWork Property Advisors, Hanover Investments (Luxembourg), and Abrams Capital Management – and collectively own about 57% of the outstanding common shares of HBC.

Earlier this week, however, HBC noted its special committee deemed the shareholder group offer "inadequate."  Catalyst has also said the insider buyout proposal by the 'Baker Group' is "not reflective of the fair value of the company's common shares."

Catalyst managing director and partner Gabriel de Alba now says: "The 10.05% of HBC shares adds to our existing holdings and we look forward to working with HBC, the special committee of the board and the company's stakeholders to ensure that this iconic company and its substantial assets are positioned to unlock value and that any transaction or strategic alternative maximise value for the benefit of all shareholders."