Sears stores have struggled with a consumer shift toward online shopping, tough competition from Wal-Mart Stores Inc. and Target Corp., and what analysts have decried as a cycle of underinvestment in stores, which many shoppers see as exhausted or lacking inventory, Crain's reported.
Headquartered in Toronto, Sears Canada had 94 department stores, 23 Sears Home stores and 10 outlets prior to the CCAA restructuring. WBAL reports real estate investment trust Seritage, which owns the 20 real estate properties, confirmed the closings- 18 Sears stores and two Kmart stores - in a government filing Friday. And the retail trouble isn't limited to the USA, as Sears Canada filed for bankruptcy on Thursday and announced it would close 59 of its more than 200 locations. There have been about 5,300 store closing announcements so far this year, according to Fung Global Retail & Technology, a retail think tank. Sears Canada filed for protection from its creditors under Canada's Companies' Creditors Arrangement Act, the equivalent of Chapter 11 bankruptcy, on Thursday.
The number of affected employees was not publicly available. Sears Holdings owns about 12% of Sears Canada, while Sears CEO Eddie Lampert owns about 45% of its shares both personally and through his hedge fund.
"The brand reinvention work Sears Canada has begun requires a long-term effort", Sears Canada said in a statement Thursday.
Sears' agreement with Seritage lets it end its leases at unprofitable stores in exchange for payment of one year's rent.