Sears to close 20 more stores as crisis continues

Nathan Bomey | USA TODAY

Show Caption Hide Caption Sears' financial troubles extend beyond U.S. Shopping mall stalwart Sears faces more hard times. Nathan Rousseau Smith (@fantasticmrnate) has the story.

Sears Holdings is closing an additional 20 outlets as the distressed department store chain seeks to stanch the bleeding amid swirling challenges for the retail sector.

The company confirmed it will shutter 18 Sears locations and two Kmart stores. Real estate investment trust Seritage Growth Properties confirmed the 20 closures in a Securities and Exchange Commission filing.

The move adds to a steady drip of closures that add up to more than 260 for the year, leaving the company with more than 1,100 locations.

The iconic American department store chain has buckled under pressure from online competitors, having failed to reinvent its brick-and-mortar experience.

Sears acknowledged in March that there was "substantial doubt" it would survive on its own, though the company said its cost-cutting maneuvers and other retail strategies would greatly improve its chances of carrying on. CEO Eddie Lampert has blasted critics and said Sears is "fighting like hell."

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Sears Holdings has shed $1 billion in costs this year, mostly through stores closures, and raised cash by selling its Craftsman brand to Stanley Black & Decker.

The latest round of stores will begin liquidation sales by June 30 and will close by mid-September, Sears said in a statement.

"We understand that members may be disappointed when we close a store, but our Shop Your Way membership platform, websites and mobile apps allow us to maintain these valued relationships long after a store closes its doors," the company said. "As a result, we hope to maintain and even grow our relationships with the members who shopped this location."

The list of stores set to close includes three in Ohio, three in New York, two in Texas and two in Maryland, USA TODAY confirmed.

The company spent about $11.2 million annually in rent on the 20 leases, according to Seritage, which was formed in 2015 in a sale-leaseback deal that provided Sears with financial aid and real estate flexibility.

The company will owe Seritage one year of rent plus one year of annual operating expenses as an early termination fee.

A Seritage spokesperson declined to comment.

Lampert's investment firm owns 43.5% of the limited partnership units of Seritage and controls 7.9% of its voting power.

The move was similar to transactions favored by investors in legacy retailers whose real estate is considered more valuable than their actual business.

Contributing: Sharyn Flanagan, Diana Kruzman

Follow USA TODAY reporter Nathan Bomey on Twitter @NathanBomey.