Sears Holdings Corp. revealed in a Monday filing with the Securities and Exchange Commission that the previously announced spinoff of its Sears’s Outlet and Sears’s Hometown and Hardware stores will now combine the two chains into one separate company.
The move, part of Sears’ initiative to cut expense and regain profits, will result in the newly named Sears Hometown and Outlet Stores Inc. and a public offering that is expected to raise $400 to $500 million for Sears.
The new company will consist of about 1,240 smaller-format stores, including 944 Hometown locations and 96 Sears Hardware stores.
Sears chairman Edward Lampert is expected to obtain a larger stake in the new company. According to a report by Reuters, Lampert’s ESL Investments hedge fund will acquire all of the stock it is entitled to and as many additional shares as are available for purchase, enabling Lampert and his funds to potentially control a larger share of Sears Hometown and Outlet Stores Inc. than the 62% they currently hold in Sears Holdings Corp.
In related news, the Monday filing also said that current chief accounting officer Robert Riecker has been named interim CFO, but will not remain with the new company with the spinoff is complete.