Kmart: 'We're not going anywhere'

RAIN OR SHINE: Tourists walk from Kmart Guam during rains brought by Typhoon Mangkhut on Sept. 10. The corporate office for the island's only Kmart assured it will stay open despite its parent company's recent filing for bankruptcy protection from creditors amid massive debt. Post file photo

Following Kmart parent Sears Holdings Corp.'s filing for bankruptcy Monday, a Sears Holdings spokesman said Guam's Kmart would remain open.

Spokesman Howard Riefs supplied a list of Sears and Kmart stores that will close, but Guam's Kmart isn't one of the 65 Kmart stores listed.

Guam Kmart General Manager Mike Fleissner confirmed the island's Kmart, which employs approximately 600 people, would keep its doors open.

"No, we're not going anywhere," he said. "We're going to have business as usual."

According to The New York Times, Sears board Chairman Edward Lampert, who has stepped down as Sears chief executive officer as part of the company's restructuring plan, intends to focus on 400 of the company's most profitable stores. Bankruptcy documents revealed that Lampert's hedge fund might ultimately buy the 400 most profitable stores and keep them open.

It's not clear if Guam's Kmart is included in that list and Riefs did not comment on any further plans. A January article in the Wall Street Journal describes Guam's Kmart as the most profitable location still open, reportedly bringing in approximately $100 million in annual sales.

Financial troubles

Over the past five years, the parent company lost about $5.8 billion; over the past decade, it shut more than 1,000 stores, The New York Times reported. Running low on cash, the company had a $134 million debt payment due Monday. Its total bank and bond debt stood at about $5.6 billion in late September.

This also won't be the first time Kmart has faced bankruptcy. In 2002, Kmart Holding Corp. filed for bankruptcy and went through restructuring, ultimately buying Sears, Roebuck and Co. two years later, according to NBC News. The merged company became Sears Holdings Corp., and now more than a decade later finds itself experiencing financial turbulence once again.

In 2015, Sears sold off stores worth $2.7 billion to a real estate company called Seritage. Lampert is a big investor in that company, as well as its chairman. Seritage is converting many of its best sites into luxury offices, restaurants and apartments, The New York Times reported.

The announcement of the Guam store remaining open came as a huge relief to many island residents, who expressed concerns with the possible closure of a store that serves residents and tourists year-round.


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