Sears (NASDAQ:SHLD) to strike a leasing deal

848

By Erik Waters on October 21, 2014 Market

Sears (NASDAQ:SHLD) is a well-known chain of American multinational department store. The company’s headquarter is in Hoffman Estates, in Chicago. Sears (NASDAQ:SHLD) has been famous amongst shoppers because of the variety and choices available to consumers. Customers like going to places where they can find everything and Sears (NASDAQ:SHLD) is one store that offers its customers a range of products under one roof. From clothes to furniture and kids’ stuff to toys; Sears (NASDAQ:SHLD) has everything. However the competition is increasing every day and in face of such tough market, all retailers have to try hard to remain in the market and make their mark. Department stores have to try their best to remain attractive to their customers and have to come up with innovative ideas to attract their attention.

On Monday morning, two announcements were made about Sears Holdings Corp. (NASDAQ:SHLD). As per the first announcement, Sears (NASDAQ:SHLD) will allow a purchase of about $625 million to its stockholders; this amount will be 8% of unsecured loans in aggregate principal, which will be due in the year 2019. Secondly, the company has been able to secure a deal with Primark, which is a retailer in British Fashion; the deal allows the company to lease space for 7 Sears (NASDAQ:SHLD) stores. Both these announcements are highly beneficial for Sears Holdings Corp. (NASDAQ:SHLD)’s growth and future.

According to a press release ESL investments, which is a private equity firm of Eddie Lampert, will act on their subscription rights’ portion of pro rata. Lampert is the CEO as well as the chairman of Sears (NASDAQ:SHLD).

According to the announcements, all stockholders of the records of the company will have the subscription rights; every stockholder will be given the right to be a part of this on equal grounds and according to its company’s stock’s pro rata ownership. Every holder of the subscription right will be able to buy at such a subscription price that will be equal to each note’s principal amount.

In the announcement, Sears (NASDAQ:SHLD) revealed the Primark lease agreements for 7 independent stores. Primark has agreed to lease about 520,000 square ft. in Sears (NASDAQ:SHLD) stores based in malls in the North East United States. This space will be given to the British firm in approximately 12 to 18 months. Meanwhile Sears (NASDAQ:SHLD) will continue with its presence in 6 of the locations.

Out of the 7 locations that Primark has agreed to lease to Sears (NASDAQ:SHLD), one is at King of Prussia Mall in Philadelphia and is projected to occupy 100,000 sq. ft of space. Another one is at Staten Island Mall, which will occupy 70,000 sq. ft of space. The locations for the remaining five stores have not been released yet.

On Friday, Sears (NASDAQ:SHLD) closed down 5.3% at $28.41 and were not active on Monday morning in the premarket. The stock’s 52 week range is said to be $23.84 to $66.77.