Sears Holdings Corp (NASDAQ: SHLD)
announced
Monday it was exploring a sale of its Kenmore brand and related assets, its Sears Home Improvement business and its Parts
Direct business.
Why It’s Important
The company’s stock has fallen 59 percent year-over-year as management has struggled to compete in digital commerce. Sears has
consistently reported mixed quarterly results, with comps generally down from the previous year’s period.
Last year, a former executive predicted the company would have to strip everything
that will "burn above the waterline of this ship" and attempt to float a smaller, more manageable boat. Until now, Sears has
resisted this strategy.
Recently, it galvanized the stock through fresh online
pursuits, including an extended Amazon.com, Inc. (NASDAQ: AMZN) partnership
for tire delivery and installation.
News of more drastic strategic alternatives, though, prompted a 12.3-percent pop in the stock.
What’s Next
A special committee of the board consisting of independent directors is initiating a formal process to evaluate previously
reported interest from ESL Investments, to solicit third-party interest and to explore strategic alternatives.
The stock traded around $3.71 at time of publication, up 8.4 percent.
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