Sears considering selling its Canadian operations
HOFFMAN ESTATES, Ill. (AP) — Sears is considering selling its Canadian operations as the retailer continues with efforts to turn around its business.
Its stock rose more than 7 percent in Wednesday premarket trading.
The retailer, which runs its namesake stores and Kmart locations, said that it is looking at strategic options for its 51 percent interest in Sears Canada. The Hoffman Estates, Illinois-based company said this includes the possible sale of its stake or the entirety of Sears Canada.
Sears Canada's board and management plan to fully cooperate with Sears Holdings as it explores strategic alternatives.
Sears Holdings previously sold some store leases in Canada. Its overall business has been struggling after years of sales declines and it's been closing some unprofitable stores.
Billionaire hedge fund manager and Sears chairman Eddie Lampert, who took over as CEO in February 2013, has been under intense pressure to turn around the business. Sears has had trouble adapting as bigger, nimbler rivals such as Wal-Mart Stores Inc. and Home Depot Inc. have stolen away customers over the years.
In 2012 Sears announced plans to restore profitability by cutting costs, reducing inventory, selling off some assets and spinning off others. Those moves helped the company reduce net debt by $400 million and generated $1.8 billion in cash from the asset sales.
Sears also has been building a loyalty program called Shop Your Way, which accounts for a majority of its sales and has tens of millions of active customers.
Sears Holdings Corp. recently spun off clothing business Lands' End as a separate public company after not having much success with it. Sears has spun off other businesses over the past three years, including its Hometown and Sears Outlet stores and its Orchard Supply Hardware Stores, to raise cash.
The company's shares climbed $3.25, or 7.5 percent, to $46.48 in premarket trading 2 ½ hours ahead of the market open.