Hoffman Estates, Ill. — Kmart completed its $12.3 billion acquisition of Sears yesterday to form the nation’s third largest retail chain after Wal-Mart and The Home Depot.
The new $55 billion entity, Sears Holding Corp., is headed by chairman Edward Lampert, who brought Kmart out of bankruptcy and brokered the buyout of Sears. Former Sears’ CEO Alan Lacy serves as vice chairman and CEO.
The company will be based at Sears’ headquarters here and will also maintain a corporate presence at Kmart’s home base in Troy, Mich.
Shareholders approved the merger by a clear majority, with about 69 percent of both Sears’ and Kmart’s respective total shares outstanding voting in favor of the proposal.
Lampert said there were no plans for wholesale store closings, and that his goal is to transform the two “O.K.” retail chains into one “great” company. “The combination of Kmart and Sears will create a leading retailer and we expect will provide heightened value for our customers, associates and shareholders,” he said. “Sears Holdings will have an enviable stable of proprietary brands, strong points of distribution and enhanced growth opportunities.”
Lacy, who faced down shouts and insults from dissident Sears shareholders after the vote, stressed that the merger will save the company $500 million in store conversions and duplicate operations, and will advance its strategy of locating Sears stores in off-mall locations. “Sears Holdings will better meet the needs of more families with outstanding products and services available in nearly 3,500 convenient locations,” he said.
Among the new company’s first action will be the conversion of upwards of 400 Kmart locations to new, smaller-format Sears Essentials stores, and layoffs at the two headquarters offices, although most of the company’s 400,000-employee workforce is expected to remain intact.