Report: layoffs and store closings at Sears Holdings

Retailers typically wait until after the holiday to close stores and announce layoffs, but widespread media reports indicated Sears Holding will be doing a little of both ahead of Christmas. The company may close as many as 100 stores and layoff nearly 5,500 people before the year’s end, according to a report which first surfaced on the Web site Seeking Alpha. Closures include over 100 Kmart, Sears and Sears Auto Center locations. Sears revenue has been in decline for 30 straight quarters.

States hit hardest by the closures include Pennsylvania, Michgan and Indiana, as well as New York, Florida, Ohio, Illinois and Minnesota. The shutdowns are affecting malls and surrounding communities that were already in decline. Some shopping centers already announced new tenants as replacements.

Sears holdings had closed 96 stores in the first half of fiscal 2014 and 93 locations in 2013. The flagship Chicago store closed its doors in April. Among the latest closures is the Sears location at the largest mall in America, the King of Prussia Mall in suburban Philadelphia.

The company stated the closures were part of an effort to “reduce ongoing expenses, adjust our asset base, and accelerate the transformation of our business model.” However some analysts are not optimistic, stating that Sears is “burning furniture to stay warm,” that the company “entered the swirling vortex,” and that “this is the end” for the retailer. Sears calls these comments “very one-sided,” adding, “We have substantial resources available to us to fund our transformation.”

In addition to liquidating stores, Sears has announced a variety of other initiatives to raise cash, including a $400 million loan from CEO Edward S. Lampert’s hedge fund, ESL investments, announced in September, $168 million raised from selling Sears Canada stock to ESL earlier this month, and a $625 million bond offering announced on Monday.