Shares of Hudson’s Bay Co. (HBC.TO) surged more than 10 per cent late Friday afternoon on reports the retailer was considering various options for its business, including going private.

The owner of Saks Fifth Avenue and Lord & Taylor retail chains is seeking to carry out a review of its options following pressure from an activist shareholder, according to a report from Reuters, citing people familiar with the matter.

Hudson's Bay is already working with an investment bank to defend itself against activist investor Johnathan Litt, who runs the Land and Buildings hedge fund that focusses on real estate. The fund disclosed a 4.3 per cent stake in Hudson’s Bay in June.

HBC is seeking to hire another financial advisor to carry out the review, Reuters reported.

The review will consider all available options, from the possibility of the company going private to potential sales of retail assets and real estate, the sources said, cautioning that no transaction is certain.

The sources asked not to be identified because the deliberations are confidential. Hudson's Bay did not respond to a BNN request for comment.

One portfolio manager told BNN that going private is a potentially risky move for the retailer.

“You obviously have to get the money to buy back all the shares to go private, which means you might end up with a heavily indebted private company where there is some uncertainty about the operating company,” said Andy Nasr, Vice President and Investment Strategist at Sentry Investments.

HBC’s own estimates peg the value of its real estate at $6.4-billion. But Nasr says monetizing those assets will not be as easy as some believe. “It’s the old op-co versus prop-co discussion where the operating company has to effectively pay the rent to the property company if you do monetize the real estate."

- with files from Reuters