Sears Canada to Pay Special Dividend After Spinoff
Sears Canada Inc. (SCC), the largest department-store chain in the country, said it will pay a special cash dividend of C$1 ($1) a share following a partial spinoff of the company from its parent last month.
Sears will pay out a total of about C$102 million on Dec. 31 to shareholders of record as of Dec. 24, the Toronto-based retailer said in a statement today.
Sears Canada’s largest shareholder other than its parent is Edward Lampert, the chairman of Sears Holding Corp. Lampert and his hedge fund owned about 28 percent of the Canadian retailer’s shares as of Nov. 21, according to Bloomberg data. The U.S. parent company, controlled by Lampert, distributed 44.5 percent of the Canadian unit’s stock to shareholders last month, retaining a 51 percent interest.
The Canadian retailer has reported 12 straight quarters of sales declines. It cut its loss by almost 50 percent in the third quarter to 22 cents a share, compared with a year earlier. Revenue dropped 6.8 percent to C$1.04 billion as the retailer reduced promotional and clearance sales.
Sears Canada will use its 60-year-old credit card database to create advertising for targeted customers and help return the retailer to profitability by 2014, Chief Executive Officer Calvin McDonald said in an interview last week.
The company rose 3 percent to C$11.23 at the close in Toronto. The shares have gained 7.6 percent this year. Sears Holdings, based in Hoffman Estates, Illinois, fell 2.6 percent to $42.38 at the close in New York. Its shares have climbed 48 percent this year.
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