Target Corp.’s exit from Canada will net the U.S. retailer about US$1.6 billion in tax breaks in the United States, according to documents.
The Minneapolis, Mn.-based company said in filings with the Securities and Exchange Commission it has already recognized the majority of the tax benefits in its first quarter and expects to book most of the rest before the end of 2015.
Target made a “strategic shift” in its business when it chose to exit Canada, the company said.
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Target Corp. said in January it planned close all 133 Canadian stores, saying it wouldn’t reach a profit in Canada for years.
The retailer, which began opening stores in early 2013, has been in court to iron out the details of its departure, with a variety of creditors that include landlords, suppliers and others impacted by the closures.
Liquidation companies have been overseeing the sale of Target’s inventory. The first wave of store closures began this week.
Suppliers have argue Target Canada owes them roughly $400 million for merchandise sent to the retailer in the weeks leading up to its bankruptcy filing.
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