Sears spin-off gets NYSE debut

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The Independent Online
NEW YORK - Shares of Dean Witter Discover, Wall Street's third-ranking retail broker and America's largest credit card issuer, began trading on the New York Stock Exchange yesterday, following a successful spin-off of the division by its parent, Sears Roebuck, writes Larry Black.

As part of a wider plan to sell its financial services operations, Sears sold 20 per cent of DWD to the public on Monday at dollars 27 a share, raising about dollars 755m. The US retail giant plans to distribute the remaining 80 per cent to its shareholders later this year.

The brokerage, acquired by Sears in 1981 for dollars 661m, has some 7,000 sales staff in 335 offices across the US, while the Discover credit card, launched by the retailer in 1986, now has 39 million customers with dollars 18.5bn in debt outstanding. Analysts said the two units complement each other well.

Last year, the operations included in the new company made dollars 670m, or dollars 2.50 a share, on sales of dollars 5.1bn. Brokerage profits have tripled in the past four years while credit-card earnings grew 20 per cent last year.

Sears - no relation to the British retail group of the same name - plans to turn over its remaining DWD shares before the end of the year, retaining only a special dollars 560m dividend.

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