Dean Witter for sale as retail owner refocuses

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The Independent Online
NEW YORK - Sears, Roebuck, the US retail chain, plans to spin off a large part of the financial services empire it assembled in recent years, refocusing on its core businesses, writes Larry Black.

Sears said yesterday it planned a public flotation of 20 per cent stakes in both its Dean Witter brokerage and its Allstate insurance division, and would sell its Coldwell Banker property arm. Later in 1993, it would sell off its remaining 80 per cent share in Dean Witter, which includes its Discover credit-card division.

The spinoffs will move more than dollars 20bn (pounds 11.3bn) in debt off Sears' balance sheet, while the equity sale will raise about dollars 3bn, analysts estimate.

Unhappy shareholders have been pressing Sears' management to deconglomerate for several years, as the chain fell from first to third ranking among American retailers.

Sears' chairman, Edward Brennan, insisted yesterday that the financial services strategy had been 'a resounding success'. He blamed the changing economic climate for the need to refocus and reduce leverage.

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