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November 12, 2018

Another Maine Kmart store axed as part of Sears' bankruptcy

Sears Holdings Corp. (NASDAQ: SLHD) axed another of its Maine stores on Thursday, announcing it will close the Kmart location in Waterville and 39 others as it moves through bankruptcy reorganization.

The Kmart store at 11 Elm Plaza in Waterville will close in February 2019, according to court documents filed last Thursday in U.S. Bankruptcy Court Southern District of New York.

In total, the new closure list includes 29 Sears stores and 11 Kmart locations -- adding to almost 142 facilities the 132-year-old retailer announced in October it would shutter in the coming months. In October's list of closings, the Hoffmann, Ill.-based retailer identified the Kmart store at 417 Main St. in Madawaska among the 142 stores slated for closure.

At that time, it was the only one in Maine on the latest closure list and among only two in New England, along with a Sears in Natick, Mass. It is expected to close by year's end.

RetailDive reported that the retailer described the new round of 40 closures as part of Sears Holdings' process "to accelerate its strategic transformation and facilitate its financial restructuring."

When Sears filed for bankruptcy last month, Chief Financial Officer Robert Riecker pointed to 400 stores that were profitable. The parent company stated at that time that its goal is to reorganize around a smaller platform of profitable stores, with the capital needed to enable it to go forward as a going venture.

The company indicated at the beginning of Chapter 11 that it intended to sell its profitable stores as a going concern in bankruptcy, potentially to its chairman and majority shareholder, Eddie Lampert (who was also its CEO until the company filed).

Meanwhile, Sears is looking to sell other major assets, including its home services business, which landed a stalking horse bid from Service.com last week , according to RetailDive.

At the time Sears said was filing for Chapter 11 the company stated it has received commitments for $300 million in debt financing while negotiating for another $300 million with ESL Investments Inc, its largest shareholder and creditor.

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