Kmart, Sears merger creates new retail giant

Two of the most familiar “baby boomer” U.S. retail chains, Kmart and Sears, Roebuck & Co., are merging in a $11 billion deal that will create the nation’s third largest retailer. The combined company, which will be known as Sears Holdings Corp., is projected to have $55 billion in revenues, 2,350 full-line and off-mall stores, and 1,100 specialty retail stores. The combined companies will continue to operate Kmart and Sears stores under their current brand names.
The merger is projected to close by the end of March 2005, and is subject to approval by Kmart and Sears shareholders.
Kmart emerged from bankruptcy in May 2003 after closing 600 stores and posted its first profitable quarter in three years in March of this year. Sears CEO Alan Lacy said the merger would help make both franchises become more profitable through a broader retail presence and improved operational efficiency in areas such as procurement, marketing, information technology and supply chain management.