Sears, Roebuck and Co. (NYSE: S) today announced that the company has closed the acquisition of ownership or leasehold interest in 50 stores from Kmart Holding Corporation (NASDAQ: KMRT) for $575.9 million. Sears has paid 30 percent of the overall purchase price for these properties, with the remaining 70 percent to be paid upon Sears taking possession of the stores.
The newly acquired stores are located primarily in large, densely populated markets with home, family and income demographics that are attractive to Sears. Sears will take possession of the stores in spring 2005 and the majority of the stores are expected to be converted by fourth quarter 2005 to Sears nameplates.
As part of the initial announcement on June 30, Sears also said it would acquire additional off-mall locations from Wal-Mart. Sears will make lease payments to Wal-Mart under subleases for six Wal-Mart stores. These stores are located in mid-size markets that fit well into Sears' market and demographic profile.
With this transaction, Sears is doubling its total number of stores in San Diego, adding five new stores to the New Jersey market and significantly increasing the total number of stores in key markets including Florida, the Northeast and Puerto Rico.
"The completion of this transaction moves Sears another step closer to its strategic goal of growing our store base and the Sears brand off-mall," said Alan Lacy, Sears chairman and CEO. "We look forward to an increased presence in these key markets and serving new and existing customers."
Representing the largest full-line store growth in company history, these new stores give Sears stronger presence in markets where the opportunities to find sites for store growth would be limited. "Opening more doors in these strategically selected locations allows Sears to compete more effectively and operate in areas closer to the customer," said Jerry Post, senior vice president, Sears off-mall strategy. "With these new locations, plus the Sears Grand stores already in development, we will quickly open more doors and dramatically boost our off-mall retail presence in attractive markets," added Post.
A New, Mid-sized Store Format
A Sears store at its core, the new mid-sized format will provide customers with traditional Sears product categories, such as apparel, home appliances, home electronics, home improvement and home fashions, plus consumables and transactional items. The floor design of the new stores will be on one level, utilizing an open racetrack design with exit cashiering at the door -- a common off-mall layout similar to that of Sears Grand stores.
As Sears begins looking to staff these new stores, the company plans to provide Kmart associates at these locations an opportunity to be considered for employment with Sears.
The locations of the former Kmart and Wal-Mart locations are as follows: K-Mart Stores Arizona 10140 N 91St Avenue Peoria AZ California 705 N Main St Corona CA 3610 Peck Road El Monte CA 2505 El Camino Real Tustin CA 12080 Carmel Mountain San Diego CA 5405 University Avenue San Diego CA 7655 Clairemont Mesa San Diego CA 4330 Camino De La Pl San Ysidro CA 935 Sweetwater Rd Spring Valley CA Connecticut 100 Main Street North Southbury CT Florida 15271 33 Mc Gregor B Ft Myers FL 15201 N Cleveland S North Ft Myers FL 1363 Nw St Lucie W B Port St Lucie FL 3020 Se Federal Hwy Stuart FL 5750 Nw 183Rd Street Hialeah FL 4560 Forest Hill Blv West Palm Beach FL 4717 S Florida Ave Lakeland FL 9500 9Th Street N St Petersburg FL Hawaii 94 - 825 Lumiaina St Waipahu HI Illinois 13200 South Cicero Crestwood IL 537 N Hicks Road Palatine IL 840 Plainfield Willowbrook IL Kentucky 4915 Dixie Hwy Louisville KY Massachusetts 10 Main St Tewksbury MA Maryland 8827 Woodyard Road Clinton MD 8829 Greenbelt Road Greenbelt MD 6411 Riggs Road Hyattsville MD Michigan 1100 Rochester Rd South Rochester MI 19800 West Rd Woodhaven MI Minnesota 10 W Lake Street Minneapolis MN New Hampshire 5 Garden Lane Londonderry NH 375 Amherst Street B Nashua NH 480 West Street Keene NH New Jersey 180 Broadway Elmwood Park NJ 733 Route 72 East Manahawkin NJ 808 Route 46 Parsippany NJ 24 34 Barbour Avenue Passaic NJ 6801 Hadley Rd South Plainfield NJ 250 New Road Rte 9 Somers Point NJ 235 Prospect Avenue West Orange NJ New York 810 Paul Rd Rochester NY 1000 Montauk Highway West Babylon NY Ohio 1105 North Court Str Medina OH Pennsylvania 3843 Linden Street Bethlehem PA Puerto Rico Ave Jesus T Pinero 4 Cayey PR State 149 And State Juana Diaz PR Carr Estatal Number Vega Alta PR 601 Yauco Plaza Yauco PR Tennessee 482 Mcbrien Rd East Ridge TN Virginia 141 West Lee Hwy Warrenton VA Wal-Mart Stores Indiana 4551 University Dr. Evansville-West IN Nebraska 7904 S 83rd St. La Vista NE Ohio 9365 Fields Ertel Rd. Cincinnati OH South Carolina 7501-A Garners Ferry Rd. Columbia SC Tennessee 393 E. Main St. (Rt 31 E) Hendersonville TN Illinois 3315 Court St. Pekin IL About Sears
Sears, Roebuck and Co. is a leading broadline retailer providing merchandise and related services. With revenues in 2003 of $41.1 billion, the company offers its wide range of home merchandise, apparel and automotive products and services through more than 2,300 Sears-branded and affiliated stores in the U.S. and Canada, including approximately 1,000 full-line stores and 1,300 specialty stores. Sears also offers a variety of merchandise and services through sears.com, landsend.com, and specialty catalogs. Sears is the only retailer where consumers can find each of the Kenmore, Craftsman, DieHard and Lands' End brands together - among the most trusted and preferred brands in the U.S. The company is the largest provider of product repair services with more than 14 million service calls made annually.
This release makes certain statements regarding the acquisition, conversion, and opening of the Kmart and Wal-Mart stores acquired by Sears, the company's strategy for growth, and the impact of the new stores on Sears presence in certain local markets. These statements are "forward-looking statements" based on assumptions about the future, which are subject to risks and uncertainties, such as competitive conditions in retail; changes in consumer confidence and spending; the successful execution of and customer reactions to the company's strategic initiatives, including the conversion of the Kmart and Wal-Mart stores and other new store locations into Sears stores, which will involve significant construction activity, hiring and training of personnel and obtaining various consents and approvals; Sears' ability to operate the new stores successfully and integrate the new stores into the Sears infrastructure, which involves leveraging the supply chain and consolidating expenses; anticipated cash flow; the possibility that the company will identify new business and strategic options for one or more of its business segments, potentially including selective acquisitions, dispositions, restructurings, joint ventures and partnerships; Sears' ability to successfully merchandise the new stores with Sears branded merchandise, including Lands' End merchandise; social and political conditions such as war, political unrest and terrorism or natural disasters; general economic conditions and normal business uncertainty. The company intends these forward-looking statements to speak only as of the time of this release and does not undertake to update or revise them as more information
SOURCE: Sears, Roebuck and Co.
CONTACT: Chris Brathwaite, +1-847-286-4681, or Corinne Gudovic,
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Sears, Roebuck and Co.
Web site: http://www.sears.com/