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Corporation (NASDAQ: SHLD) is a major retail conglomerate formed in 2005 by the merger of Sears, Roebuck and Co. of Hoffman Estates, Illinois with Kmart Holdings Corporation of Troy, Michigan. The company operates 3,900 retail locations under the mastheads of Sears, Sears Grand,
Sears Essentials, Sears Hardware, Kmart, Big Kmart, Super Kmart, The Great Indoors, Orchard Supply Hardware,
and Lands' End stores. It is the ninth largest
retailer by annual revenue in the United States trailing behind
Wal-Mart, The Home Depot, Costco, Target, CVS Caremark, Walgreens, Kroger, and Lowe's.
The company maintains its
corporate headquarters in Hoffman Estates, Illinois.
Sears Holdings continues to
operate stores under the Sears and Kmart mastheads. In 2005, Sears introduced a new store format, called Sears Essentials; Some Kmart stores were
converted to Sears Essentials, as well as a few locations that were acquired
from Wal-Mart and several bankrupt discount retailers. The new store format
combined the Sears store concept with the Kmart format, which was supposed to help the company better compete
with Wal-Mart and Target. The project has since been resigned, and merged with the Sears Grand
Sears Holdings has begun
cross-selling merchandise between its two brands. For example, Craftsman tools are now available in Kmart stores;
they were previously exclusive to the Sears brand. However, Martha Stewart brand paint colors are now no longer
available at Sears.
Sears Holdings owns 90.4%
of Sears Canada, a large department store chain in Canada, similar to
the United States stores. (Sears Holdings failed in
2006 to buy the remainder of Sears Canada that it does not own because Bill Ackman took a 17.3% stake in it and
prevented any takeover. He accepted to sell his stake at 30$ a share on April 23, 2010) Sears Holdings also
owns 20% of Sears Mexico. (Carlos Slim owns the other 80%.)
Like Target stores, Kmart-branded stores in Australia belong to Wesfarmers (which acquired former owners Coles Group in 2007); Wesfarmers also holds the rights to the
Kmart brand in New Zealand.
In 2005, Sears Holdings sold a
stake in hardware chain Orchard Supply Hardware to private equity firm Ares Management.
In November 2006, speculation
rolled around as The Chicago Sun Times reported that Sears may
buy Safeway, Home Depot, Gap, Radio Shack, Pep Boys, Anheuser Busch or all six
companies. The Washington Post, in an article dated March 11, 2007, described the current Sears
as a hedge fund with money being diverted from the maintenance and improvement of
stores to non-retail financial investments. A former executive is quoted as saying the company faces an
"uncertain future." Surprisingly, a third of pre-tax income in the third quarter of 2006, according to the
Washington Post, was due to financial trades not the retail business. However, these investments performed
poorly in the fourth quarter.
On December 14, 2007, Sears
Holdings submitted a draft merger agreement to buy Restoration Hardware for $6.75 a share. Sears already owns
13.7% of the company. That offer was withdrawn after Restoration's shares tumbled and a competing bid from
private equity firm Catterton Partners was lowered to $4.50 per share. On
February 28, Sears Holdings made an offer of $4.55 a share.
In June 2008, Sears launched
Servicelive.com, which was intended to connect Sears customers with local contractors for home improvement
projects. The site charges 10% of the contract price for each completed service, and offers more than 40,000
contractors. Servicelive.com was redesigned in March 2010.
On February 22, 2010, Sears
Automotive business has launched a new Independent Sears Auto Center franchise program that offers automobile
dealers the opportunity to operate licensed Sears Auto Centers.The Coleman Auto Group of East Windsor, New Jersey,
is the first dealership and is expected to open a Sears auto center in March 2010.