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Sears' CEO Is Stepping Down

1/28/2008 07:51:00 AM Eastern

Hoffman Estates, Ill. — Sears Holdings CEO Aylwin Lewis will leave the company later this week and will be replaced on an interim basis by W. Bruce Johnson, executive VP, supply chain operations.

Lewis will leave his position Feb. 2 and will also leave the company's board of directors 

Sears will immediately start a formal search for a permanent CEO, the company said. Lewis' departure follows 

news

 last week of a major restructuring at the120-year-old chain.

Edward S. Lampert, chairman of Sears Holdings, said, "We've accomplished a great deal under Aylwin's leadership and we are very grateful for his commitment to Sears during a critical time in the company's history."

He added that given the company's newly decentralized structure, which is built around five separate business units, "the board has determined that now is the right time to put in place new leadership to take the company forward."

Lewis joined Kmart as president/CEO just prior to its merger with Sears in 2004, and later succeeded Alan Lacy as president/CEO of parent company Sears Holdings.

Johnson joined Kmart in 2003 from Carrefour SA, the French hypermarket chain, where he was director of organization and systems. Sears credits him with integrating and improving its supply chain and expanding its direct sourcing function. In his new role he will oversee the five new business units.

Under the new operational structure Lampert no longer has any direct reports.

The changes follow several quarters of disappointing sales at the company's Sears and Kmart divisions.

In a statement, Johnson said, "We remain focused on ensuring that our expense base is appropriate for the size of our business and we continue to test new ideas, learn from the results, and aggressively roll out new initiatives that we believe will succeed and make a difference."

That statement, plus Johnson's operational vs. merchandising background, suggests to Bank of America retail analyst David Strasser that the company stands to lose additional market share. "In our opinion, Sears Holdings should continue to be a share donor throughout 2008," he observed in a research note. "It appears like a gift [to other retailers] in a tough environment to have a $50 billion-in-revenue retailer continuing to concede share."

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