Fashion website Gilt is settling down with a deal to sell itself to Hudson's Bay. The one-time darling online fashion destination is selling at a steep discount. The saleable cost is not surprising.

The once lofty valuation for the fashion website's present condition is deteriorating. Hudson's Bay, the owner of Saks Fifth Avenue, is in talks to purchase the start-up at about $250 million.

As per NY Times report, Gilt is also speaking with a handful of other potential buyers in addition to Hudson's Bay, according to another person briefed on the talks. Gilt fetched $1 billion valuations three years ago and surely now the considerable selling price is quite less. The final deal might be announced officially early in the next year.

However, people were warned that negotiations are still going on and it can fall apart anytime. Gilt actually shook up the fashion industry when they launched the business eight years ago. It has practically been on roller coaster ride since they started.

The focal point of the company was flash sales where consumers have limited time to purchase products sold by the site. Soon after they started with this idea, Gilt became a star in the start-up community of New York.

It was considered as an eligible IPO candidate. Gilt struggled when their flash sales lost their charm among people. According to the Market Watch news, Hudson's Bay plans to pair Gilt with its off-price Saks Off 5th brand, cited one of the people familiar with the matter.

The associated person also added that the plans are still under consideration call. However, the spokesperson mentioned that HBC plans to keep most of the management of Gilt intact.

Gilt not only arranged sales for fashion items, they also ran online sales of furniture and other goods. During their flourishing time, Gilt raised money from an eminent list of investors including General Atlantic, Goldman Sachs Group, SoftBank Group and Matrix Partners. Earlier this year, once-hot-and-happening start-up Zulily Inc. also sold their business to Liberty Interactive Corp.

Gilt founded in 2007 is run by CEO Michelle Peluso at present. The founders of Gilt are Alexandra Wilkis Wilson - CEO of Glamsquad, an on-demand beauty facility, Alexis Maybank, Dwight Merriman and Kevin Ryan. As per the Techcrunch report, Kevin Ryan also founded MongoDB and Business Insider, which recently sold for $450 million.

The future of Gilt completely depends upon the deal and whether Hudson's Bay will be able to close the deal or not. Only time will speak the rest.