Sears announced today (Thurs., June 22, 2017) it has sought creditor protection and is closing 59 Canadian locations in an attempt to restructure and avoid bankruptcy.
Sears Canada Inc. has obtained $450 million in debtor-in-possession financing from the Ontario Court of Justice under the Companies’ Creditors Arrangement Act (CCAA) to maintain operations. The company will have an initial 30-day period to restructure.
The announcement comes two week after Sears’ reported a $144-million quarterly net loss.
The company is closing 20 full-line stores, 15 Sears Home locations, 10 Sears Outlets and 14 Sears Howntown stores. Twenty-two of the soon-to-be shutdown stores are located in Western Canada, including a full-line location in Kamloops at Aberdeen Mall and an outlet stores in Abbotsford.
Sears says it will use the period of protection to reinvent the brand and create a “Sears 2.0.”
“The brand reinvention work Sears Canada has begun requires a long-term effort, but the continued liquidity pressures facing the Company as well as legacy components of its business are preventing it from making further progress and from restructuring its legacy assets and businesses outside of a CCAA proceeding,” a press release states.
Sears hopes to exit CCAA protection as soon as possible, this year. A timeline for store closures, liquidations and a layoff of 2,900 workers has yet to be finalized.
Full list of store closures: