Sears Holdings Corporation: Financial Analysis

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Sears Holdings Corporation I. Company Overview Sears Holdings is a relatively new company, having only been created in November of 2004 (Barbash & Barbaro, 2004). At that time, Kmart Holdings purchased Sears, Roebuck, and Co. The corporation decided it would operate stores under both names, and the merger was officially completed in March of 2005. The shareholders voted to close the deal, or it would not have been able to take place. Now the company is called Sears Holdings, and it operates both Sears and Kmart stores (Barbash & Barbaro, 2004). The company also markets both brands without blending them or favoring one over the other. There were several reasons why the companies chose to combine. One of the main reasons Sears and Kmart merged was that Sears had started investing in stores that were free-standing and not located in malls. These stores were larger, newer, and called Sears Grand. Sears then purchased a large number of Super Kmart stores earlier in 2004, which made it much easier for the merger to be completed (Barbash & Barbaro, 2004). The process was accelerated by the number of stores the companies already owned, and was not as complicated or time consuming as a merger of companies that were not in any way related to one another or where there was no cross-store ownership. There were also proprietary brands that were held by both Kmart and Sears, and with the merger it would be easier to get those brands out to the target demographics. Making each
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