Dive Brief:
- The new Sears plans to close 96 stores under its namesake and Kmart banners by February, with liquidation sales starting in December, the company said in a statement.
- That will leave the retailer with a total of 182 Sears and Kmart stores. "We will continue to evaluate our Sears and Kmart footprint, consistent with our overall retail and service strategy," the company (Transform Holdco) said.
- Sears also announced it received $250 million in new financing from the company's owner, Eddie Lampert and his ESL Investments hedge fund, along with another unnamed party.
Dive Insight:
Sears is something of a mathematical paradox. It continues to liquidate at a dizzying pace, without ever disappearing entirely.
A decade ago, Sears Holdings had more than 3,900 stores to its name. By next year, the new Sears will have a footprint 96% smaller.
The latest round of closures comes atop another 100 or so store closings reported in the media this fall. As it tries to stay afloat, the company is also mulling the sale of its DieHard battery brand and other assets, according to The Wall Street Journal.
In that respect, the new Sears looks just like the old Sears (i.e., Sears Holdings), which for years before entering Chapter 11 closed hundreds of stores a year, sold or spun off prized assets, borrowed from Lampert and slashed staff as it bled money and lost sales.
At some point, logic would seem to demand that Sears run out of assets to sell and stores to close. But many expected the company to liquidate in bankruptcy last year if not close long before that. And yet, here we are.
The company acknowledged that it has "faced a difficult retail environment and other challenges" since acquiring the remaining Sears and Kmart stores from Sears Holding (whose CEO, and majority investor and lender, was Lampert). But Transform still projected optimism around what is left of its business.
"We will endeavor to create and deliver value through a strategic combination of our better-performing retail stores and our service businesses, brands and other assets, and expect to realize a significant return on our extensive portfolio of owned and leased real estate," the company said.
Sears also plans to add home improvement retailer Sears Hometown — once a part of Sears Holdings before being spun off — back into the fold. Sears Hometown, though, is also hemorrhaging money and sales and faced liquidation before Lampert moved to buy it.
