Kmart Holding Corp and Sears, Roebuck and Co said Wednesday that they are merging to form a new retail company called Sears Holdings Corp that will be the US' third-largest retailer with about US$55 billion in annual revenues.
The agreement, worth about US$11 billion, weaves together the companies' networks of 3,450 stores, of which 1,100 are specialty retail, according to a statement posted on the Sears Web site.
benefits
"The combined business will have a broader retail presence and improved scale through a national footprint of nearly 3,500 retail stores," the statement said.
The merger will also benefit from improved operational efficiency in areas such as procurement, marketing, information technology and supply chain management, it added.
The Kmart and Sears stores will continue to operate under their current names.
performance
Sears has been trying to turn around its performance for several years but has had limited success. As it has redesigned stores and added to its merchandise in hopes of increasing sales, competitors like Wal-Mart Stores and Lowe's have snatched away its customers.
Kmart in August posted its third profitable quarter in a row, even as sales declined 15 percent. Bolstered by its real estate holdings -- some 1,400 stores around the country -- it was in the odd position of losing ground in consumer sales while generating significant profits as a company.
The merger is expected to close by the end of March, and is subject to approval by shareholders. The company will have its headquarters at the Sears headquarters in the Chicago suburbs, but the statement said it would maintain a "significant presence" in Troy, Michigan, where Kmart is based.
The board of directors of both companies unanimously approved the terms of the agreement, under which shareholders will receive one share of new Sears Holdings common stock for each Kmart share.
Sears, Roebuck shareholders will have the right to elect to have US$50 in cash or 0.5 shares of Sears Holdings for each Sears, Roebuck share.
The chairman of Kmart, Edward Lampert, will be the chairman of Sears Holdings.
"This is something we have been working on very diligently," Lampert said at a news conference in New York. "This is going to be an enormous undertaking."
expanded distribution
Lampert, who is the founder of the investment company ESL Partners, said in the statement that the merger would create a "powerful leader" in the retail industry with expanded distribution points and better opportunities for efficiency.
"The merger will enable us to manage the businesses of Sears and Kmart to produce a higher return than either company could achieve on its own," he said.
He said that a low cost structure was needed to compete with their biggest competitors. The immediate focus of the two companies would be the upcoming holiday season, he added. Then they will "go forth from there," according to Aylwin Lewis, the president and chief executive officer of Kmart.
Taiwan’s Lee Chia-hao (李佳豪) on Sunday won a silver medal at the All England Open Badminton Championships in Birmingham, England, a career best. Lee, 25, took silver in the final of the men’s singles against world No. 1 Shi Yuqi (石宇奇) of China, who won 21-17, 21-19 in a tough match that lasted 51 minutes. After the match, the Taiwanese player, who ranks No. 22 in the world, said it felt unreal to be challenging an opponent of Shi’s caliber. “I had to be in peak form, and constantly switch my rhythm and tactics in order to score points effectively,” he said. Lee got
EMBRACING TAIWAN: US lawmakers have introduced an act aiming to replace the use of ‘Chinese Taipei’ with ‘Taiwan’ across all Washington’s federal agencies A group of US House of Representatives lawmakers has introduced legislation to replace the term “Chinese Taipei” with “Taiwan” across all federal agencies. US Representative Byron Donalds announced the introduction of the “America supports Taiwan act,” which would mandate federal agencies adopt “Taiwan” in place of “Chinese Taipei,” a news release on his page on the US House of Representatives’ Web site said. US representatives Mike Collins, Barry Moore and Tom Tiffany are cosponsors of the legislation, US political newspaper The Hill reported yesterday. “The legislation is a push to normalize the position of Taiwan as an autonomous country, although the official US
CHANGE OF TONE: G7 foreign ministers dropped past reassurances that there is no change in the position of the G7 members on Taiwan, including ‘one China’ policies G7 foreign ministers on Friday took a tough stance on China, stepping up their language on Taiwan and omitting some conciliatory references from past statements, including to “one China” policies. A statement by ministers meeting in Canada mirrored last month’s Japan-US statement in condemning “coercion” toward Taiwan. Compared with a G7 foreign ministers’ statement in November last year, the statement added members’ concerns over China’s nuclear buildup, although it omitted references to their concerns about Beijing’s human rights abuses in Xinjiang, Tibet and Hong Kong. Also missing were references stressing the desire for “constructive and stable relations with China” and
‘RELATIVELY STRONG LANGUAGE’: An expert said the state department has not softened its language on China and was ‘probably a little more Taiwan supportive’ China’s latest drills near Taiwan on Monday were “brazen and irresponsible threats,” a US Department of State spokesperson said on Tuesday, while reiterating Washington’s decades-long support of Taipei. “China cannot credibly claim to be a ‘force for stability in a turbulent world’ while issuing brazen and irresponsible threats toward Taiwan,” the unnamed spokesperson said in an e-mailed response to media queries. Washington’s enduring commitment to Taiwan will continue as it has for 45 years and the US “will continue to support Taiwan in the face of China’s military, economic, informational and diplomatic pressure campaign,” the e-mail said. “Alongside our international partners, we firmly
RSS