TORONTO – Sears Canada said Thursday it is seeking court protection from its creditors in order to restructure its business.
The struggling retailer has piled up losses and seen its stock dive, losing more than 80 per cent of its value in the last year, despite efforts to reinvent itself at a time when more Canadians are shirking bricks-and-mortar in favour of online shopping.
It has also gone through several leadership changes in recent years.
List of Sears branded stores to close from official company release. pic.twitter.com/ll8BWLxYzJ
— mike eppel (@eppman) June 22, 2017
The company, which was founded as a mail-order business in 1952, warned just last week there was “significant doubt” about its future and that it could be sold or restructured.
Sears is seeking protection under the Companies’ Creditors Arrangement Act, a federal law that gives businesses a chance to operate under court supervision while working out a plan with bond holders, landlords, suppliers and other creditors.
“The brand reinvention work Sears Canada has begun requires a long-term effort,” Sears Canada said in a statement Thursday.
“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.”
Sears Canada said if the Ontario Superior Court of Justice grants it creditor protection, it will try to complete its restructuring and aim to exit protection as soon as possible this year.
Its announcement didn’t elaborate on what it expects to do to restructure its business.
Headquartered in Toronto, Sears Canada has 94 department stores, 23 Sears Home stores and 10 outlets.
