Sears takes further step out of troubled shoe retailing

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The Independent Online
Sears, the troubled retail group, has taken a further step in the withdrawal from its loss-making footwear business with the sale of 44 Shoe City branches for a net loss of pounds 16m. The remaining 39 stores which are all large out of town warehouse style outlets, are expected to close with the loss of 650 jobs. Shoe City is thought to have recorded losses of pounds 5m last year on sales or around pounds 60m.

The stores are being sold for pounds 6m to Brantano, Belgium's second largest shoe retailer which is making its first foray into the UK market. Following the recent sales of Dolcis and Shoe Express, Sears now has only the 25 profitable Cable & Co stores to sell. A deal is expected by the end of next month.

So far the break-up and sale of Sears' loss-making British Shoe Corporation has involved around 4,000 job losses. A further 650 jobs are at risk at British Shoe's headquarters and distribution centre in Braunstone, Leicestershire. The net costs of the retrenchment programme to Sears has been pounds 115m , slightly less than the pounds 150m expected. Around 300 shops have closed in the Shoe Express Shoe City and concessions businesses.

It is a remarkable demise for a business that until recently controlled 2,000 shoe shops in Britain and was responsible for one in five of every pair of shoes sold.

Sears will now concentrate on the de-merger of its Selfridges department store business which should take place next summer. Freemans, the mail order business whose sale to Littlewoods was blocked by the competition authorities, is also expected to be spun-off in 2-3 years. The return of around pounds 80m to shareholders is also expected, though no decision has been taken on the timing.

- Nigel Cope

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