Sears closes 150 more stores, sells Craftsman brand
Department-store chain Sears Holdings is seeking to stem its bleeding by closing another 150 stores, including 108 Kmart locations, and selling its Craftsman brand to raise cash.
The ailing retailer said Thursday that it had reached a deal to sell the tools brand to Stanley Black & Decker for a net present value of about $900 million, including future royalty payments.
The move came several months after Sears put the Craftsman, Kenmore and DieHard brands up for sale as it seeks an elusive turnaround.
The company said late Tuesday that it would close 108 Kmart stores and 42 Sears stores, calling it "a difficult but necessary step as we take actions to strengthen the company’s operations and fund its transformation."
Sears also announced Tuesday that it had landed access to $500 million in secured loans provided by Sears CEO and Chairman Edward Lampert's ESL Investments. Lampert has invested heavily in Sears as he attempts to revitalize the retailer.
Sears shares rose 3.4% to $10.77 at 10:10 a.m. Stanley Black & Decker stock rose 2.4% to $119.23.
Taken together, the steps reflect Sears' latest bid to stay afloat in a retail market that is weakening big-box chains, including competitors such as Macy's and Kohl's. Macy's on Tuesday identified 68 stores it will close or that have already closed and said it will correspond with about 6,200 job cuts, including management positions at central operations.
Selling the Craftsman brand to Stanley Black & Decker bolsters the balance sheet for Sears, which reported a $748 million loss in its fiscal quarter ended Oct. 29 as sales at stores open at least a year fell 7.4%.
The chain will still operate more than 1,300 stores following the latest closures and will continue to sell the Craftsman brand.
Stanley Black & Decker said it would expand sales and manufacturing of the Craftsman brand, which currently gets 90% of its sales from Sears locations.
"This transaction represents a significant step in our ongoing transformation to a membership focused business model," Lampert said in a statement. "Craftsman has a storied history as an iconic American brand and in Stanley Black & Decker we have found a great owner that is committed to expanding Craftsman and helping it to reach its potential outside of its current channels."
Sears closing 150 stores, selling Craftsman in attempt to survive
Department-store chain Sears Holdings is seeking to stem its bleeding by closing another 150 stores, including 108 Kmart locations, and selling its Craftsman brand to raise cash.
The ailing retailer said Thursday that it had reached a deal to sell the tools brand to Stanley Black & Decker for a net present value of about $900 million, including future royalty payments.
The move came several months after Sears put the Craftsman, Kenmore and DieHard brands up for sale as it seeks an elusive turnaround.
The company said late Wednesday that it would close 108 Kmart stores and 42 Sears stores, calling it "a difficult but necessary step as we take actions to strengthen the company’s operations and fund its transformation."
Sears also announced Wednesday that it had landed access to $500 million in secured loans provided by Sears CEO and Chairman Edward Lampert's ESL Investments. Lampert has invested heavily in Sears as he attempts to revitalize the retailer.
Sears (SHLD) shares rose 0.3% to close at $10.39 on Thursday. Stanley Black & Decker stock rose 1.61% to close at $118.35.
Taken together, the steps reflect Sears' latest bid to stay afloat in a retail market that is weakening big-box chains, including competitors such as Macy's and Kohl's. Macy's on Wednesday identified 68 stores it will close or that have already closed and said it will correspond with about 6,200 job cuts, including management positions at central operations.
Selling the Craftsman brand to Stanley Black & Decker bolsters the balance sheet for Sears, which reported a $748 million loss in its fiscal quarter ended Oct. 29 as sales at stores open at least a year fell 7.4%.
The chain will still operate more than 1,300 stores following the latest closures and will continue to sell the Craftsman brand.
Stanley Black & Decker said it would expand sales and manufacturing of the Craftsman brand, which currently gets 90% of its sales from Sears locations.
"This transaction represents a significant step in our ongoing transformation to a membership focused business model," Lampert said in a statement. "Craftsman has a storied history as an iconic American brand and in Stanley Black & Decker we have found a great owner that is committed to expanding Craftsman and helping it to reach its potential outside of its current channels."
Sears and Kmart closing 150 stores
Sears is shutting down 150 more stores, yet another sign of how tough it is for former kings of the retail industry to compete in a world now dominated by Amazon.
Sears (SHLD) said on Thursday that it would close 109 Kmart stores and 41 of its namesake Sears outlets. The announcement came on the same day that Sears disclosed plans to sell its iconic Craftsman tool brand to Stanley Black & Decker (SWK).
The company did not say how many workers would be affected by the store closures.
But a spokesperson said that most of them were part-time workers and that "we are committed to treating these associates with respect and compassion during this process."
Sears also closed 78 stores last year and more than 200 in 2015.
The news also follows disappointing holiday results from other retail stores: Macy's (M) -- which is also closing stores and laying off workers -- and Kohl's (KSS).
Sears CEO Eddie Lampert said in a statement that the company was "taking strong, decisive actions...to stabilize the company and improve our financial flexibility in what remains a challenging retail environment."
The company noted that while the 150 stores collectively reported sales of $1.2 billion over the past 12 months, they also lost about $60 million. Sears has to stop the bleeding somehow, because the entire company is losing money.
"The decision to close stores is a difficult but necessary step as we take actions to strengthen the company's operations and fund its transformation," Lampert said.
"Many of these stores have struggled with their financial performance for years and we have kept them open to maintain local jobs and in the hopes that they would turn around," he added.
Lampert stressed that the only way for the whole company to return to profitability will be for Sears to focus more on its better performing stores. (Click here for a list of the Kmart and Sears stores that are getting shut down.)
The company said that workers at the closing stores will receive severance payments and also have the opportunity to apply for positions at other Sears and Kmart stores in their area. And liquidation sales at the affected stores will begin on Friday.
Sears stock rose more than 5% on Thursday despite the bad news. But Macy's, Kohl's and other retailers sank.
The ailing retailer said Thursday that it had reached a deal to sell the tools brand to Stanley Black & Decker for a net present value of about $900 million, including future royalty payments.
The move came several months after Sears put the Craftsman, Kenmore and DieHard brands up for sale as it seeks an elusive turnaround.
The company said late Tuesday that it would close 108 Kmart stores and 42 Sears stores, calling it "a difficult but necessary step as we take actions to strengthen the company’s operations and fund its transformation."
Sears also announced Tuesday that it had landed access to $500 million in secured loans provided by Sears CEO and Chairman Edward Lampert's ESL Investments. Lampert has invested heavily in Sears as he attempts to revitalize the retailer.
Sears shares rose 3.4% to $10.77 at 10:10 a.m. Stanley Black & Decker stock rose 2.4% to $119.23.
Taken together, the steps reflect Sears' latest bid to stay afloat in a retail market that is weakening big-box chains, including competitors such as Macy's and Kohl's. Macy's on Tuesday identified 68 stores it will close or that have already closed and said it will correspond with about 6,200 job cuts, including management positions at central operations.
Selling the Craftsman brand to Stanley Black & Decker bolsters the balance sheet for Sears, which reported a $748 million loss in its fiscal quarter ended Oct. 29 as sales at stores open at least a year fell 7.4%.
The chain will still operate more than 1,300 stores following the latest closures and will continue to sell the Craftsman brand.
Stanley Black & Decker said it would expand sales and manufacturing of the Craftsman brand, which currently gets 90% of its sales from Sears locations.
"This transaction represents a significant step in our ongoing transformation to a membership focused business model," Lampert said in a statement. "Craftsman has a storied history as an iconic American brand and in Stanley Black & Decker we have found a great owner that is committed to expanding Craftsman and helping it to reach its potential outside of its current channels."
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| © Steven Senne, AP. Shoppers enter a Sears department store. |
Sears closing 150 stores, selling Craftsman in attempt to survive
Department-store chain Sears Holdings is seeking to stem its bleeding by closing another 150 stores, including 108 Kmart locations, and selling its Craftsman brand to raise cash.
The ailing retailer said Thursday that it had reached a deal to sell the tools brand to Stanley Black & Decker for a net present value of about $900 million, including future royalty payments.
The move came several months after Sears put the Craftsman, Kenmore and DieHard brands up for sale as it seeks an elusive turnaround.
The company said late Wednesday that it would close 108 Kmart stores and 42 Sears stores, calling it "a difficult but necessary step as we take actions to strengthen the company’s operations and fund its transformation."
Sears also announced Wednesday that it had landed access to $500 million in secured loans provided by Sears CEO and Chairman Edward Lampert's ESL Investments. Lampert has invested heavily in Sears as he attempts to revitalize the retailer.
Sears (SHLD) shares rose 0.3% to close at $10.39 on Thursday. Stanley Black & Decker stock rose 1.61% to close at $118.35.
Taken together, the steps reflect Sears' latest bid to stay afloat in a retail market that is weakening big-box chains, including competitors such as Macy's and Kohl's. Macy's on Wednesday identified 68 stores it will close or that have already closed and said it will correspond with about 6,200 job cuts, including management positions at central operations.
Selling the Craftsman brand to Stanley Black & Decker bolsters the balance sheet for Sears, which reported a $748 million loss in its fiscal quarter ended Oct. 29 as sales at stores open at least a year fell 7.4%.
The chain will still operate more than 1,300 stores following the latest closures and will continue to sell the Craftsman brand.
Stanley Black & Decker said it would expand sales and manufacturing of the Craftsman brand, which currently gets 90% of its sales from Sears locations.
"This transaction represents a significant step in our ongoing transformation to a membership focused business model," Lampert said in a statement. "Craftsman has a storied history as an iconic American brand and in Stanley Black & Decker we have found a great owner that is committed to expanding Craftsman and helping it to reach its potential outside of its current channels."
Sears and Kmart closing 150 stores
Sears is shutting down 150 more stores, yet another sign of how tough it is for former kings of the retail industry to compete in a world now dominated by Amazon.
Sears (SHLD) said on Thursday that it would close 109 Kmart stores and 41 of its namesake Sears outlets. The announcement came on the same day that Sears disclosed plans to sell its iconic Craftsman tool brand to Stanley Black & Decker (SWK).
The company did not say how many workers would be affected by the store closures.
But a spokesperson said that most of them were part-time workers and that "we are committed to treating these associates with respect and compassion during this process."
Sears also closed 78 stores last year and more than 200 in 2015.
The news also follows disappointing holiday results from other retail stores: Macy's (M) -- which is also closing stores and laying off workers -- and Kohl's (KSS).
Sears CEO Eddie Lampert said in a statement that the company was "taking strong, decisive actions...to stabilize the company and improve our financial flexibility in what remains a challenging retail environment."
The company noted that while the 150 stores collectively reported sales of $1.2 billion over the past 12 months, they also lost about $60 million. Sears has to stop the bleeding somehow, because the entire company is losing money.
"The decision to close stores is a difficult but necessary step as we take actions to strengthen the company's operations and fund its transformation," Lampert said.
"Many of these stores have struggled with their financial performance for years and we have kept them open to maintain local jobs and in the hopes that they would turn around," he added.
Lampert stressed that the only way for the whole company to return to profitability will be for Sears to focus more on its better performing stores. (Click here for a list of the Kmart and Sears stores that are getting shut down.)
The company said that workers at the closing stores will receive severance payments and also have the opportunity to apply for positions at other Sears and Kmart stores in their area. And liquidation sales at the affected stores will begin on Friday.
Sears stock rose more than 5% on Thursday despite the bad news. But Macy's, Kohl's and other retailers sank.
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