TORONTO – Sears Canada Inc. is planning to shut down two Greater Toronto Area store locations by next year following a deal to relinquish its leases to their landlords to save money, the company announced Friday.
“We were presented with an opportunity that gives us a significant financial benefit without changing our plans to improve the business and make Sears more relevant to Canadians,” said Calvin McDonald, President and Chief Executive Officer, Sears Canada Inc. in a press release.
The retailer will sell its leases at two shopping centre locations in the Yorkdale Shopping Centre and the Square One Shopping Centre in Mississauga, co-owned by Oxford Properties Group and Alberta Investment Management Corporation, for $191 million. Sears would vacate the stores by March 31, 2014.
“The possible release of select assets is an initiative we have previously proposed as a way to create total value for the Company,” said McDonald.
Sears has also agreed to sell an option relating to a third store located at the Scarborough Town Centre for $1 million, which could raise another $53-million within five years for the company.
The retailer says jobs will not be impacted as it plans to reposition employees in other locations within the GTA.
Lately, Sears has been facing stiffer competition from retail newcomers such as Target which launched its first stores across Canada in March.
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