A shareholder group led by Baker, which collectively owns a 57% stake in Hudson's Bay, had made an offer of C$9.45 per share to take the struggling retailer private in June, with plans to fund the deal using some of the proceeds from asset sales.
Catalyst, run by Canadian financier Newton Glassman, on Monday offered to buy up to 14.85 million shares of Hudson's Bay at C$10.11 per share, saying it believes Baker's proposal "greatly undervalues the company."
Catalyst also requested the special committee of independent directors to explore alternatives to "maximize value for all shareholders over the near or long term."
Activist shareholder Jonathan Litt had also lambasted Baker's bid in June to take the Canadian retailer as "woefully inadequate," saying the chairman-led shareholder group looking to push through a deal could double the offer.
Canada's Globe & Mail newspaper last month reported that Catalyst had taken a portion of a 10% stake in Hudson's Bay from the Ontario Teachers' Pension Plan. (https://tgam.ca/30MW2i0)
(Reporting by Shanti S Nair in Bengaluru, editing by G Crosse)