Lord & Taylor, founded as a dry goods store in 1826, has struggled recently as more people shop online. It has closed several stores, including its flagship on New York's Fifth Avenue, which shut its doors for good this year after more than a century in the 11-story building. There are currently 38 Lord & Taylor stores across the country. Le Tote, created less than a decade ago in San Francisco, said Wednesday that it plans to bring clothing rental to Lord & Taylor's customers. With clothing rental, popularized by Rent the Runway and other startups, customers pay a monthly fee to get clothes shipped to them, wear a few times and then ship back. Traditional retailers, such as Urban Outfitters and Banana Republic, are launching their own versions. Le Tote will pay Hudson's Bay $75 million in cash when the deal closes, which is expected to happen before the holiday season. It also will pay Hudson's Bay $25 million in cash after two years. Hudson's Bay, based in Canada, also owns Saks Fifth Avenue.
Clothing rental firm Le Tote will acquire department store Lord & Taylor from Hudson's Bay in a cash deal worth $100m. The deal is expected to close before the Christmas shopping season and, post-acquisition, Le Tote will extend its clothing rental service to Lord & Taylor customers. As part of the agreement, Hudson Bay will gain a minority stake in Le Tote and two board seats.