HBC is buying online seller Gilt Groupe and its nine million members for $250 million. (Nathan Denette/Canadian Press)

Hudson's Bay Co. is preparing to pay $250 million US cash to buy Gilt Groupe Holdings, Inc., a membership-based online retailer that caters to shoppers in the millennial generation.

The Toronto-based retailer says Gilt has more than nine million members and the acquisition is expected to add about $500 million US to HBC's overall revenue this year.

About half of Gilt's revenue is generated by mobile shoppers.

The Gilt acquisition will complement HBC's growing digital business, which is integrated with its store-based operations under banners such as Hudson's Bay, Lord & Taylor and Saks Fifth Avenue.

Headquartered on New York City's prestigious Park Avenue, Gilt was founded by Kevin Ryan in 2007 as an invitation-only site for women's clothing and accessories. It has since expanded into products for homes, babies and children and men.

The companies see a close fit between Gilt and Saks OFF 5th, an HBC banner that's open stores in Canada this year.