Sears Looks to Unload Stake in Sears Canada

By RetailFOXBusiness

Sears Holdings (NASDAQ:SHLD) said Wednesday it may sell its majority stake in Sears Canada or put the entire Canadian retailer on the block.

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The Sears and Kmart parent has unloaded several units over the last two years, spinning off Sears Hometown & Outlet Stores (NASDAQ:SHOS) and Orchard Supply Hardware. Most recently, the company spun off clothing brand Lands’ End (NYSE:LE) to existing shareholders.

The Hoffman Estates, Ill.-based department-store operator is also exploring strategic options for Sears Auto Center, a chain of repair shops. Sears lost $1.4 billion in fiscal 2013 and has closed 300 U.S. stores since 2010.

Sears said it plans to hire an investment bank to help the company evaluate a possible sale involving Sears Canada, which is 51%-owned by Sears. CEO Ed Lampert’s hedge fund, ESL Investments, owns a minority stake in the subsidiary.

Sears Canada has around 450 stores and swung to a profit last year even though sales dropped. The department-store chain is facing more competition, with rivals like Target (NYSE:TGT) and Wal-Mart Stores (NYSE:WMT) expanding their operations in Canada.

Sears rose 1% to $43.67 in recent trading, paring bigger gains from early Wednesday. As of Tuesday’s close, the stock was down 11.9% since the start of 2014.