US discount retailer Kmart has announced that it will now sell 45 stores to Sears, Roebuck and Co, rather than the possible 54 stores originally agreed.
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At the end of June, Kmart and Sears entered into an agreement on the sale of up to 54 stores for up to US$621m in cash. Kmart will now sell 45 stores for cash proceeds totalling $524.45m, subject only to customary closing conditions.
The sale of up to another 6 stores remains subject to certain additional conditions that must be met within the next 15 days. The cash proceeds from these 6 additional stores would total up to $65.25m.
“The stores we are retaining from the originally announced transaction are operating profitably. As has always been contemplated, Kmart will continue to operate those stores for which certain conditions related to the assignment of the store leases to Sears have not been met. We look forward to providing continued service to our customers at these locations,” said Kmart chief executive officer Julian C. Day.
As previously announced, Kmart will continue to operate the stores that will be sold to Sears until March or April 2005.
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By GlobalDataKmart expects to receive 30% of the final sales proceeds from Sears no later than 30 September 2004. The remaining 70% of the final sales proceeds will be received by Kmart when Sears has taken occupancy of the properties, which is due to occur no later than 15 April 2005.
