Fashion e-commerce site Gilt, once valued at $1 billion, is in advanced talks to be acquired by Saks Fifth Avenue’s parent Hudson’s Bay Company for $250 million, according to the Wall Street Journal.
Gilt, which operates limited-time sales of designer clothes, accessories and home goods, has been struggling to maintain its once red-hot growth. Earlier this year, the online retailer put its plans for an initial public offering on hold.
Gilt had previously raised over $250 million from Softbank, Matrix Partners and General Atlantic. The company declined to comment on the report.
Fellow rivals in flash sales haven’t performed well either. Zulily’s shares plunged over 60% following its IPO last year, and, earlier this year, the company sold itself to the parent of home shopping channel QVC for $2.4 billion. Vente-Privee USA, the U.S. outpost of European flash sales site Ventee-Privee, shut its doors last year. Meanwhile, RueLaLa reportedly laid off staff earlier this year.
According to the Wall Street Journal, Hudson’s Bay will combine Gilt with Saks’ discount brand, Saks Off 5th. The plans include opening Gilt-branded stores within Saks Off 5th stores. Gilt’s management would likely stay at Hudson’s Bay.
Hudson’s Bay acquired Saks Fifth Avenue in 2013, as it looked to boost its e-commerce presence and revenue. In 2014, Saks generated 72% of HBC’s overall e-commerce sales. Online sales are presumed to be a relatively small part of Hudson Bay’s overall business. By buying Gilt, the company would be adding to its e-commerce operations as way to play catch up.
In addition to Saks, Hudson Bay owns the clothing chain Lord and Taylor. Based in Canada, Hudson Bay is North America’s longest continually operating company, having received a charter from the King of England in 1670.
If the deal takes place, Gilt would be one of growing number of unicorn companies, those startups valued at $1 billion or more, to falter. Theranos, once valued at $9 billion, is battling questions about its technology, and Evernote, has experienced executive turnover and layoffs as it prepares to go public.
Shares of Hudson’s Bay Company fell 3.8% in after hours trading.
