Hedge fund manager and head of the company, Edward Lampert tried for seven years to rebuild the company, Sears Holdings Corp.,  and has apparently thrown in the towel on the entire endeavour.  Mr. Lampert tried to apply the “lessons of investing to retailing.”

He pledged to spend capital only on projects that yielded measurable returns, and not to put sales growth ahead of profits.

What this means was letting the company become a place where nobody wants to shop.  I don’t even remember the last time I went into a Sears or a K-Mart, much less spent any money.  It’s sad because I used to love Craftsman products – I own an old Craftsman mower and tiller and used to own a lawn tractor.  I also have a Kenmore refrigerator and washer & dryer set my wife and I bought 20 years ago that are still going strong.

There are several reasons why I won’t shop at a Sears or K-Mart.

First, the stores are run down and dreary. Shopping in a run down, dreary, and dirty store is depressing.  Why do I want to spend my hard earned money at a store that clearly does not respect its customers?  Sears Holdings Corp. does not value their customers or show them respect by keeping their stores in such deplorable condition.  There is so much competition out there where stores make shopping fun and exciting.  Stores that value and show respect for customers keep their environment clean, updated and fresh.

Second, It is difficult to find a sales associate to help and when you do, they are poorly trained in customer service and product knowledge. Again a clear lack of respect for their customers and for their employees.

Finally, I rarely was able to find what I am looking for.  I know I can find the item(s) I’m looking for at Walmart, The Home Depot, or any other department store in the mall.  It only took a couple times striking out at a Sears or K-Mart to decide it was a waste of my valuable time – especially when I know my chances are much greater almost anywhere else.

Mr. Lampert needs to take care of his customers as well as his investors.  By taking good care of his customers, his investors will benefit.  He seems to have no interest in respecting his customers by the way he treats his stores and his employees. He is now paying the price of this disrespect by losing his customer base and competent employees and, seemingly, his business.

The news comes a few months after the Illinois legislature agreed to give the company, which runs the Hoffman Estates Economic Development Area bearing its name, $150 million in income tax breaks over the next 10 years.

Lawmakers approved the tax breaks for Sears and for Chicago-based CME Group after both companies had been threatening to leave Illinois over a corporate tax hike that took effect at the beginning of last year.

LISTEN: WBBM Newsradio’s Alex Degman reports

Does this layoff announcement violate the spirit of the legislation passed?

“I’m not sure. I wish I had an answer to that,” said State Sen. Michael Noland (D-Elgin). “But I do know that, you know, if they’d announced these layoffs prior to the passage of that legislation, they would have had a much tougher go than they did.”

A Sears spokesman said the layoffs “absolutely” do not violate the spirit of the tax breaks.

The layoffs announced Thursday were not the only act of downsizing by Sears since the tax incentives were approved by lawmakers last year.

In late December, Sears announced that up to 120 Sears and K-Mart stores were closing nationwide. In a letter to employees shortly after Christmas, Sears chief executive officer and president Lou D’Ambrosio said that the retailer had not “generated the results we were seeking during the holiday.”

So far, Sears has revealed 81 of the stores that will close, none of which is in Illinois.

Sears must maintain 4,200 jobs in its economic development area to keep the tax incentives. It has no obligation to maintain a minimum job number at its corporate headquarters.

Even with Thursday’s layoff announcement, the EDA still exceeds the minimum number of jobs required to keep the tax incentives.

“We’ve known that the situation with Sears is much worse than had been reported,” Noland said. “The financials have been worsening for a number of years, and [the layoffs come] as no shock.”

“There is a rumor that Bruce Berkowitz of Fairholme and Eddie Lampert could take Sears private,” Jon Najarian, a co-founder of online stock, options and futures brokerage TradeMonster.com in Chicago said.

That rumor followed some unusual buying in Sears call options during the first 25 minutes of trading, he said. Buying of Sears stock and options moved up as the rumor of a leveraged buyout spread, he said.

Sears spokesman Chris Brathwaite said the company had no comment on market rumours or speculation.

The speculation comes just days after a major business lender, CIT Group Inc., halted loans that Sears’ suppliers use to finance the goods they sell to the struggling chain.

Morningstar analyst Paul Swinand also said the shares were up on a “Lampert writes a check scenario.”

“It would make sense to be private, but they still have to improve the operating structure and costs, pension, etc., then reinvest in stores, and then get appliances to sell again,” Swinand added.

Sears shares were trading at double their full session average by 11:30 am EST. Its option volume was 2.9 times the average daily levels, with 44,000 calls and 16,000 puts traded during the first two hours of the session, according to options analytics firm Trade Alert.

According to documents filed last Wednesday, Lampert, who owns directly and through related entities about 59% of the company, bought roughly $159-million worth of Sears shares from his ESL Investments hedge fund, representing 4.46 million shares in private sales. In addition, Lampert also bought shares on the open market for about US$12-million.

Many were skeptical about Sears’ chances of going private.

“We think the company has bigger issues that could make a “going private” transaction impossible, including significant cash burn with rapidly deteriorating financial performance and reduced liquidity, particularly if the major vendors become reluctant to fund holiday 2012 shipments,” Mary Ross Gilbert, managing director, Imperial Capital said.

Sears shares were up about 9.3% at US$36.67 in midday trading on the Nasdaq. They touched a high of US$38.80 earlier in the session.

© Thomson Reuters 2012

The news comes just weeks after the operator of Sears department stores and the Kmart discount chain posted dismal holiday sales numbers, and decided to close as many as 120 stores.

A Bloomberg report citing unnamed sources said late Wednesday that CIT, the business lender run by Wall Street executive John Thain, will no longer approve credit for orders after Wednesday. CIT said they won’t comment on an individual company.

“We disagree with their action,” Sears spokeswoman Kimberly Freely said in an email to Reuters. “In fact, we’d point out that other factors are approving shipments to Sears Holdings and CIT’s payables represented less than 5% of inventories.”

The company also pointed out that it “has more than adequate liquidity and ample resources at our disposal.”

Sears shares were down 9.1% at US$29.95 in premarket trading on Thursday.

A Sears Holdings’ collapse was not seen likely in the near future. But that could change if key vendors lose faith and demand cash on delivery, decide to ship in smaller quantities, or ask for letters of credit, bankruptcy experts have told Reuters.

© Thomson Reuters 2012

The new law, which is effective for the 2012 tax year, expands the state’s earned-income tax credit. It’s now 5 percent of the federal credit and will climb to 7.5 percent next year and 10 percent the year after.

State officials said it would eventually translate to an average of about $100 a year per family. Currently about 900,000 families meet income guidelines in Illinois, but some advocates estimated 1 million will qualify this year.

“We can’t forget everyday people who are the heart and soul of Illinois,” Quinn said at a bill signing ceremony in Chicago. He said the money would stimulate local economies and reward working families.

The new law also would increase the personal exemption by $50 to $2,050. That’s the amount of money exempt from state income taxes for each person. The exemption also would increase each year by the rate of inflation.

Quinn demanded tax relief for individuals in exchange for approving the tax breaks for Sears Holdings Corp. and CME Group Inc., which operates the Chicago Mercantile Exchange. It gave him political cover for giving big employers tax breaks in a year when income taxes were raised; he signed legislation last January that raised the personal tax rate to 5 percent from 3 percent.

He approved the law granting hundreds of millions of dollars in incentives and tax breaks for Sears and CEM last month. It renewed a credit Sears has been receiving for years and guarantees the Hoffman Estates-based company a $15 million break on its taxes over the next 10 years and extends a property-tax cut. Sears officials had said the company would stay in Illinois if Quinn approved the bill.

For CME, lawmakers agreed to reconfigure tax calculations for the profitable company by changing how much of its business is subject to state income taxes. CME officials said the company would remain Illinois where it’s been for more than a century.

Officials estimated the package for the companies and individuals— which legislators split into two parts last month to increase the chances of passing them — is likely to cost Illinois about $330 million in revenues during the second year, when the tax measures are fully in effect.

Advocates for poor families applauded the Tuesday’s law.

Illinois’ old 5 percent earned-income tax credit rate was among the lowest in the country. On the other end of the spectrum, Vermont’s rate is 32 percent of the federal earned-income tax credit, according to a state website.

“It’s good news for working families. This is really a victory for parents,” said Kelley Talbot, a policy director at Voices for Illinois Children. “Parents will be able to stretch their income a little bit further.”

Rhonda Jones, 43, of Chicago, who has five children, said even $100 can make a difference. She makes about $30,000 a year working in a school counselor’s office.

She said in the past the extra money has helped her fill up the deep-freezer or pay for one of her college-aged sons to make a trip home to see family.

“The earned-income tax credit has helped me out of a lot of jams,” she said.

(TM and © Copyright 2012 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)

Lou D’Ambrosio, chief executive officer of Sears Holdings Corp., said creatively combining more technology with increased spending on stores is the strategy to turn around the largest U.S. department store chain.

On Dec. 27, Sears announced it was closing as many as 120 locations after same-store sales slipped 5.2% in the eight weeks ended Dec. 25. The shares plunged 27% on the news, the biggest drop since April 29, 2003. Sears fell 3.4% in New York on Dec. 30 to US$31.78.

A former Avaya Inc. and International Business Machines Corp. executive who joined the Hoffman Estates, Illinois-based company in February, D’Ambrosio is drawing on his tech background and telling managers to gather more information about customers’ buying patterns and product preferences and to ramp up Web operations.
“Everything starts with knowing what our customers want to buy and how and then delivering that across platforms,” he said in a telephone interview.

Sears technicians each year make 17 million visits to customers’ homes and communicate even more frequently with shoppers online and on the phone, according to D’Ambrosio.

As part of that effort, Sears has given store salespeople more than 5,000 Apple Inc. iPads and 11,000 iPod touches to track inventory and customer orders, he said.

Sears Chairman Edward Lampert, who along with his hedge funds owns 60% of Sears, has attempted multiple turnaround strategies that have failed to reverse a slide in sales. D’Ambrosio is the fourth CEO since Lampert merged Sears with Kmart in 2005.

Capital Starved

The company’s larger stores have been starved of capital investment and customers have defected, according to Gary Balter, an analyst with Credit Suisse Group AG in New York.

Sears is spending less than a quarter of the US$8 a square foot that retailers typically invest to maintain stores, according to International Strategy & Investment Group. In an August report, the New York-based company put Sears and Kmart at the bottom of the list of a dozen retailers ranked by sales per square foot and operating profitability.

“Sure we want to have stores that look nice so we’re investing in fixtures, paint and new designs but store appearance in itself isn’t enough,” D’Ambrosio said. “Borders had great bathrooms but that didn’t help them because they missed the e-book revolution in their industry.”

While Lampert sticks mostly to his base in Greenwich, Connecticut, D’Ambrosio is in close touch with managers down the ranks and visited several Sears stores last month, he said.

“Eddie and I have aligned views about what it takes to make this company great,” D’Ambrosio said. “We’re in touch regularly.”

The retailer’s “assets are undervalued, which creates an opportunity,” said D’Ambrosio, who recalls visiting Sears auto centers with his father as a child. “Sears is an iconic brand. It’s important to revitalize this company.”

Bloomberg News

CHICAGO (CBS) – Sears has released a list of the first 79 stores to close under a plan to shutter 100 to 120 Sears and Kmart locations due to poor holiday sales.

No Illinois Sears or Kmart stores are among the stores listed on the Hoffman Estates-based company’s website, but three locations are in Indiana, including a Kmart in St. John in northwest Indiana.

Sears Holdings Corp. announced Tuesday that it was closing between 100 and 120 Sears and Kmart stores nationwide because of dismal holiday sales.

LISTEN: WBBM Newsradio’s Nancy Harty reports

In an internal memo Tuesday to employees, CEO and President Lou D’Ambrosio said that the retailer had not “generated the results we were seeking during the holiday.”

Sears discussed the closings with Gov. Pat Quinn on Wednesday.

“Governor Quinn had a good long conversation with the Sears CEO yesterday and we are definitely pleased with today’s outcome,” said Quinn’s spokeswoman, Brooke Anderson.

Anderson said she doesn’t know when the stores on Thursday’s list will close, nor if any of the remaining slated closures will be in Illinois.

News of the store closings comes just less than two weeks after Illinois lawmakers and the governor signed off on extending tax breaks designed to keep Sears’ corporate headquarters in Illinois.

Until earlier this month, the corporate tax rate in Illinois had been a major complaint for Sears. The company had been considering leaving Illinois, until Gov. Pat Quinn approved a multimillion dollar tax break for Sears and the CME Group, which was also considering departing the state.

The governor has said the closures don’t affect the state’s $15 million-a-year in tax incentives to keep Sears headquarters in Hoffman Estates.

“The fact that they have to close some stores around the country, that isn’t good news, but it doesn’t directly affect this agreement,” Quinn said.

The company said it will post on this Web site when a final list is compiled. Sears would not discuss how many, if any, jobs would be cut.

Sears has more than 4,000 stores in the U.S. and Canada.

The closings are the latest and most visible in a long series of moves to try to fix a retailer that has struggled with falling sales and shabby stores.

In an internal memo Tuesday to employees, CEO and President Lou D’Ambrosio said that the retailer had not “generated the results we were seeking during the holiday.”

Sears Holdings Corp. said it has yet to determine which stores will close but said it will post on http://www.searsmedia.com when a final list is compiled. Sears would not discuss how many, if any, jobs would be cut.

The company has more than 4,000 stores in the U.S. and Canada. Its stock dropped $8.67, or 18.9 percent, to $37.18 in morning trading. The shares dipped to their lowest point in more than three years at $36.51 during the first few minutes of trading.

The company’s revenue at stores open at least a year fell 5.2 percent to date for the quarter at both Sears and Kmart, the company said Tuesday. That includes the critical holiday shopping period.

Sears Holdings said the declining sales, ongoing pressure on profit margins and rising expenses pulled its adjusted earnings lower. The company predicts fourth-quarter adjusted earnings will be less than half the $933 million it reporter for the same quarter last year.

Sears Holdings also anticipates a non-cash charge of $1.6 billion to $1.8 billion in the quarter to write off the value of carried-over tax deductions it now doesn’t expect to be profitable enough to use.

Sears said it will no longer prop up “marginally performing” stores in hopes of improving their performance and will now concentrate on cash-generating stores.

“These actions will better enable us to focus our investments on serving our customers,” D’Ambrosio said.

The weaker-than-expected performance reflects what analysts say is a deteriorating outlook for the retailer.

The results point to “deepening problems at this struggling chain and renewed worries about Sears survivability,” said Gary Balter, an analyst at Credit Suisse. “The extent of the weakness may be larger than expected but the reasons behind it are not. It begins and some would argue ends with Sears’ reluctance to invest in stores and service.”

Balter also said Sears’ weakening performance may lead its vendors to start to worry about their exposure.

The company has seen rival department stores like Macy’s Inc. and discounters like Target Corp. continue to steal customers. It’s also contending with a stronger Wal-Mart Stores Inc., the world’s largest retailer, which has hammered hard its low-price message and brought back services like layaway, which allows financially stressed shoppers to finance their holiday purchases by paying a little at a time.

The tough economy hasn’t helped, either. Middle-income shoppers, the company’s core customers, have seen their wages fail to keep up with higher costs for household basics like food.

But the big problem, analysts say, is Sears hasn’t invested in remodeling, leaving its stores uninviting.

“There’s no reason to go to Sears,” said New York-based independent retail analyst Brian Sozzi, “It offers a depressing shopping experience and uncompetitive prices.”

Sears Holdings Corp., based in Hoffman Estates, Ill., said that the store closings will generate $140 to $170 million in cash from inventory sales. The retailer expects the sale or sublease of real estate holdings to add more cash.

Sears Holdings appeared to stumble early in the holiday season, as it opened its Sears, Roebuck and Co. stores at 4 a.m. on Black Friday, the day after Thanksgiving. Rivals including Best Buy Co., Wal-Mart Stores Inc. and Toys R Us opened as early as Thanksgiving night. Sears stores had opened on Thanksgiving Day in 2010. Kmart has been opening on Thanksgiving for years.

A hint that trouble might be brewing came in mid-December when Sears Holdings unexpectedly announced that 260 of its Sears, Roebuck and Co. locations would stay open until midnight through Dec. 23.

Kmart’s 4.4 percent decline in revenue at stores open at least a year was blamed on diminished layaways and a drop in clothing and consumer electronics sales. Part of Kmart’s layaway softness likely stemmed from competitive pressure. Wal-Mart had said that its holiday layaway business had been popular. Toys R Us expanded its layaway services to include more items. Kmart’s grocery sales climbed during the period.

Sears cited lackluster consumer electronics and home appliance sales for its 6 percent dropoff. Sears’ clothing sales were flat. Sales of Lands’ End products at Sears stores rose in the mid-single digits.

Sears Holdings said it also plans to lower its fixed costs by $100 million to $200 million and trim its 2012 peak domestic inventory by $300 million from 2011′s $10.2 billion at the third quarter’s end.

D’Ambrosio acknowledged in his internal memo that criticism over Sears Holdings’ performance was likely to come, but that the company was prepared for the days ahead.

“We will bounce back and become stronger than ever,” he said.

(© Copyright 2011 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)

Sales at Sears Holdings, whose chairman and top shareholder is hedge fund manager Edward Lampert, have fallen every year since it was formed through the merger of Sears and Kmart in 2005.

And so far this holiday season, the drop has continued. Same-store sales at Kmart were down 4.4% in the current quarter through Christmas Day, and down 6% at Sears’ U.S. stores. Companywide, they were down 5.2%, the company said on Tuesday.

Sears said that typically, it would keep “marginally performing” stores open to give them time to improve, but “we no longer believe that to be the appropriate action in this environment.”

[np-related]

The store closings follow its announcement last quarter it would shutter 10 stores. Kmart and Sears have a combined 2,177 U.S. full service locations and another 500 in Canada.

Sears blamed poor consumer electronics sales in a tough economic environment “especially for big-ticket items” for more than half of the decline in its namesake chain’s domestic same-store sales.

It even reported lower layaway sales, which are designed to allow lower income shoppers to pay for items in installments.

Sears Holdings said the lower sales and margin pressure would lead to adjusted fourth-quarter earnings before interest, debt and amortization of less than half of the year-ago quarter’s US$933-million figure.

Last month, Sears reported a much wider than expected quarterly loss as higher markdowns and pricing pressures in appliances squeezed margins.

The retailer, home to brands including Craftsman tools and Kenmore appliances, expects to earn US$140-million to US$170-million by selling of inventory in affected stores and selling or subleasing store space.

Sears also expects to record a non-cash charge of US$1.6-billion to US$1.8-billion in the fourth quarter related to a valuation allowance on certain deferred tax assets.

© Thomson Reuters 2011

As CBS 2’s Susanna Song reports, the Illinois House of Representatives broke up the tax incentives package that failed earlier in the month into two bills – one addressing corporate tax breaks for the two companies, research and development credits and sunset extensions; and the other dealing with tax relief for low-income families.

[worldnow id=6539074 width=385 height=255 type=video]

The issue of corporate tax breaks dates back to January, when the Democrat-dominated General Assembly approved a $7 billion income tax increase.

Now, 11 months later, lawmakers are feeling the pressure as the Chicago-based CME Group – which operates the Chicago Mercantile Exchange and Chicago Board of Trade – and Hoffman Estates-based Sears Holdings Corp., the parent company of Sears and K-Mart – threaten to leave the state.

The only way they’ll stay, they claim, is if the state cuts them a deal.

Last week, Mayor Rahm Emanuel urged lawmakers to approve the bills and keep the companies in the state.

But critics argue the state cannot afford to provide tax breaks – not now, when it’s facing an $8 billion budget deficit.

House Minority Leader Tom Cross (R-Oswego) agreed to help pass the deal in the House, but says the state cannot afford to keep crafting these deals.

“People are going to say ‘look, once again, the state of Illinois provided a credit to somebody, we need to go to the state of Illinois.’ We can’t keep doing that,” he says. “Because of that, we’re going to have to address issues like whether our tax rate is too high.”

Cross says lawmakers will figure out how to pay for the $250 million package later.

The new package is similar to the ill-fated deal that received just eight votes in the House last week. The estate tax exemption has been increased from $2 million to $3.5 million as of Jan 1, 2012, and to $4 million on Jan. 1, 2013.

Cross says the new incentives package for corporations will likely pass the House. State Rep. John Bradley (D-Marion), the head Democrat in the talks, couldn’t speculate on whether the House will pass tax relief for low-income families.

Meanwhile, Indianapolis and Columbus, Ohio, are two cities that have tried to lure the two companies to move to their cities, offering big financial incentives. The State of Ohio is offering $400 million to lure Sears’ corporate headquarters.

Gov. Pat Quinn said last week that the $15 million over the next 10 years that Illinois is offering to keep Sears is “more than adequate,” and there will not be a bidding war with Ohio.

As WBBM Newsradio’s David Roe reports, the bill included tax breaks for both Sears Holdings Corp. and the CME Group. Both companies have threatened to leave Illinois because of what they say is its inhospitable corporate tax climate.

LISTEN: WBBM Newsradio’s David Roe reports

The state Senate approved the tax package Tuesday, but it failed in the House the same day by a vote of 8-99.

In multiple published reports, a spokesman for Sears called the defeat of the bill disappointing. He says Sears is standing by earlier statements that it will decide on its future in Illinois by the end of the year.

Sears confirmed in October that it is in discussions about two prospective sites that are not in Illinois over the corporate tax hike. Reports said the two sites are in Austin, Texas, and Columbus, Ohio.

The CME Group has not commented. Previously, executive director Terrence Duffy warned that if the state did not hurry up and move on a tax break, his company would explore moving the Chicago Mercantile Exchange and the Chicago Board of Trade out of Illinois.

Duffy said in June that the firm would lose about $50 million this year from the tax hike.

The tax package would have provided about $85 million in tax relief for financial companies CME Group Inc. and CBOE Holding Corp. Sears would have gotten a $15 million break each year for the next decade.

The bill also included other breaks that would have applied to Illinois businesses in general, including a research-and-development credit and changes in the way losses can be applied to tax bills.

(TM and © Copyright 2011 CBS Radio Inc. and its relevant subsidiaries. CBS Radio and EYE Logo TM and Copyright 2011 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed. The Associated Press contributed to this report.)

The Legislature could convene again when negotiators come up with a new version of the package, but there was no hint of whether that would take days or weeks or even longer. Senate President John Cullerton, D-Chicago, suggested action could be delayed until spring without any problem.

Coming up with a more palatable plan could be difficult. While the Senate approved the tax package Tuesday, it failed in the House on a stunning 8-99 vote.

LISTEN: WBBM Newsradio’s Alex Degman reports

Before adjourning, both the House and Senate approved a plan to tinker with the budget so that Gov. Pat Quinn would cancel plans to close seven state facilities and lay off about 1,900 employees. The legislation, which Quinn supports, shifts money in the budget but doesn’t increase overall spending.

They also sent the governor legislation meant to curtail abuses of public pension systems. It would bar employees from earning pension credit while on leave working for unions, and also prohibit employees from “double-dipping” by getting credit from union pension systems and public systems at the same time.

The measure also attempts to cancel pension benefits for two Illinois Federation of Teachers lobbyists who qualified for teachers’ pensions by spending just a single day in the classroom as substitutes. But that could run into constitutional roadblocks.

The tax package would provide about $85 million in tax relief for financial companies CME Group Inc. and CBOE Holding Corp., both of which have threatened to leave Illinois unless they get a break. Sears Holdings Corp., which also says it might leave, would get a $15 million break each year for the next decade.

It also includes other breaks that apply to Illinois businesses in general, including a research-and-development credit and changes in the way losses can be applied to tax bills.

Families would get about $110 million in tax relief in the Senate version, which passed 36-18. The standard personal exemption on income taxes, now $2,000, would be bumped to $2,050 and then increase with the rate of inflation in future years. The state version of the earned-income tax credit for poor families would rise to 10 percent of the federal credit, up from 5 percent.

Some House members wanted to see bigger tax credits for the poor. “Everybody has gotten everything that they wanted except the EITC,” said Rep. Will Davis, D-Homewood.

The measure’s sponsor urged lawmakers to accept the package, even if it wasn’t ideal. Rejecting it could deny poor families any relief at all, warned Rep. John Bradley, D- Marion.

“Why can’t low-income individuals still get something out of this?” Bradley said.

The lopsided House vote may not reflect the proposal’s actual level of support. Lawmakers who are willing to back a contentious measure sometimes wind up voting “no” once it becomes clear the bill won’t pass.

The Senate president said the tax proposal is still alive, despite the House vote. It has made it halfway through the Legislature, Cullerton said, so backers should concentrate on building support in the House.

He noted the legislation could be approved early next year because the tax provisions don’t kick in until July, although CME officials have been pushing for a decision this fall.

“Maybe it’s going to take some time to reflect on it and pass it,” Cullerton said.

(TM and © Copyright 2010 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)

But on Thursday night, a protest rally in northwest suburban Algonquin drew some 3,000 people, who said the tax breaks would be lost revenue for schools in the area.

LISTEN: WBBM Newsradio’s Dave Berner reports

As WBBM Newsradio’s Dave Berner reports, Community District 300 Supt. Michael Bregy quoted the movie “Independence Day” and told the crowd filling the gymnasium H.D. Jacobs School in Algonquin that those against the tax breaks “will not go quietly into the night,” the Daily Herald reported.

The newspaper says the fight is over Illinois Senate Bill 540, which would extend the Sears economic development area for another 15 years. It was established to keep Sears from moving out of the state back in 1989, and it is set to expire in two years.

When the tax break was enacted, the company had been threatening to move to North Carolina, so the state put together the tax incentives and Sears moved from the Sears Tower – now known as the Willis Tower – to Hoffman Estates.

Supporters say the extension of the tax break is needed for Illinois to remain competitive, as Sears considers options in other states, the Daily Herald reports.

But those at the rally say 23 years is long enough, and the tax incentives for Sears will take $14 million out of the school district’s hands, the newspaper reported.

Sears confirmed this month that it is in discussions about two prospective sites that are not in Illinois. Reports said the two sites are in Austin, Texas, and Columbus, Ohio.

Sears is one of many companies that have discussed moving out of Illinois due to a hike in the state’s corporate tax in January, from 9.5 percent from 7.3 percent. Rumors that Sears was considering abandoning Illinois surfaced in May.

Sears has been in Illinois from the very beginning. Richard Warren Sears moved his company from Minneapolis to Chicago and met partner Alvah C. Roebuck in 1887.

But the mayor of Hoffman Estates, where the company is now based, said in May that the departure by Sears is a real threat.

As CBS 2’s Kris Habermehl reports, Sears has been around the Chicago area for nearly 125 years, and 20,000 employees are based in Illinois.

[worldnow id=6207500 width=385 height=255 type=video]

Crain’s Chicago Business reports on Tuesday, Sears Holdings Corp. chief executive officer Lou D’Ambrosio and other executives met with Illinois State Senate President John Cullerton (D-Chicago) to determine what would keep Sears in Illinois. The meeting was held at Sears’ headquarters in Hoffman Estates.

No deal was struck at the meeting, Crain’s reported, but Sears and the state did make progress.

Sears said in a statement after the meeting it had commenced conversations with elected officials in Illinois “and elsewhere,” and thanked Cullerton and other Illinois lawmakers for their attention, Crain’s reported.

Sears is one of many companies that have discussed moving out of Illinois due to a hike in the state’s corporate tax in January, from 9.5 percent from 7.3 percent. Rumors that Sears was considering abandoning Illinois surfaced in May.

The following month, a more specific report by the Washington Post indicated that Sears which also owns K-Mart, had been inquiring about sites near Washington, D.C. Sears has also been looking at Georgia, New Jersey, North Carolina and Texas as possible sites for its headquarters, the Washington Post reported.

Richard Warren Sears moved his company from Minneapolis to Chicago and met partner Alvah C. Roebuck in 1887.
But the mayor of Hoffman Estates, where the company is now based, said in May that the departure by Sears is a real threat.

“It’s a real possibility that Sears could relocate,” Hoffman Estates Mayor Bill McLeod told CBS 2’s Jim Williams last month. “They have a responsibility to their shareholders, to make the best deal they can for them.”

Back in 1989, the company threatened to move to North Carolina, so the state put together a package of tax incentives and Sears moved from the Sears Tower – now known as the Willis Tower – to Hoffman Estates.

Gov. Pat Quinn indicated in May that he may make a similar effort to keep the company in Illinois.

“I’m sure we’ll work out something that will work for the company, but most importantly, work for the common good; for the workers; for the jobs,” Quinn said in May.

Amazon.com Inc. (AMZN) said it is severing ties with affiliates in Illinois, citing a law signed today that imposes taxes on consumers who make online purchases.

The affiliates — websites that send customers to Amazon through links — will no longer be paid for sales that result from the referrals, Seattle-based Amazon said today in an e- mail.

This is the latest salvo in a fight between Amazon and states including California, New York and North Carolina over efforts to collect tax from the world’s largest online retailer. Sears Holdings Corp. (SHLD), Barnes & Noble Inc. (BKS) and Wal-Mart Stores Inc. have all begun publicly courting affiliates that Amazon has cut off.

                                                                                                                                    …read more

n an unusual move, the owner of Sears and Kmart is publicly seeking out additional businesses to operate in its stores, including several Valley locations.

Sears Holdings Corp. launched a website earlier this year detailing information about store locations available to rent — in both closed stores and ones still open.

Five Valley stores show up on http://www.shcrealty.com as places the company would welcome new businesses operating within the existing stores. They include Kmart stores in Clovis, Coalinga and Kingsburg, and Sears stores and their auto centers in Sierra Vista Mall in Clovis and Manchester Center in Fresno.

“Traditionally when retailers look to do things like this, they usually do it quietly,” said Scott Testa, a professor who follows the retail business at Cabrini College in Philadelphia. “The idea that they would do this in a public forum … is in some ways very unique.”

New tenants could locate within a current store — either a cart or a shop — or in another empty space in a Sears Holdings-owned shopping center.

“It’s basically letting people know that in these locations we have some extra space,” said Sears Holdings spokeswoman Kim Freely. “If the partnership makes sense, we could make some additional retail space available for other vendors.”

Freely used the example of Edwin Watts Golf Shops, which is opening 12 shops inside Sears stores around the country.

It’s not unusual for stores to open within larger stores — think Starbucks inside Target or Sephora’s recent appearance inside J.C. Penney stores.

Although not typical, Sears’ real-estate website is just another form of marketing, said Walter Smith, senior vice president of Grubb & Ellis/ Pearson Commercial realty firm in Fresno.

“They’re just helping to make sure they get as much exposure as possible,” he said.

Sears owns many of the properties its stores are in, Smith said.

When billionaire investor and Kmart chairman Edward Lampert bought Sears and merged the two companies in 2005, Wall Street analysts expected the new company to make money selling valuable locations.

The real estate crash prevented that, however, and Sears Holdings was stuck with 3,900 full-line and specialty stores. The company closed 60 underperforming stores in 2009, but remains a company “that is struggling to find its way,” competing against heavy hitters like Target and Walmart, Testa said.

Testa said the website could be a way for the company to find out if it can make more money leasing to another retailer instead of operating a Sears or Kmart, but Freely from Sears Holdings said that is not the intent.

Smith and representatives from Sierra Vista and Sears Holdings all said no deals for new stores inside Sears or Kmart stores in the Valley had been finalized.

But, said Smith, “it could be happening in our market, and that’s OK.”

http://www.tradingmarkets.com/news/stock-alert/kmrt_shld_sears/kmart-offers-to-rent-valley-stores-980973.html

HOFFMAN ESTATES, IL – February 18, 2010 – (Motor Sports Newswire) – Sears Holdings Corp. today announced the launch of a new strategic initiative for the Sears Automotive business.  The Independent Sears Auto Center franchise program offers automobile dealers the opportunity to operate licensed Sears Auto Centers, bringing the Sears brand, buying power, distribution network, systems and corporate support to automotive aftermarket businesses.  Coleman Auto Group of East Windsor, New Jersey, is the first dealership to take advantage of this opportunity and will open a Sears Auto Center in March 2010.  Coleman Auto Group is utilizing a space formerly dedicated to its Chrysler dealership.

Grand opening date: March 27, 2010

Location: Coleman Auto Group, 917 Route 130, East Windsor, NJ 08520

With over 3000 automobile dealerships that have lost their franchise, Sears designed the new franchise program to help those dealers leverage their facilities by building a set of businesses around parts and services, over-the-counter merchandise, and previously-owned vehicle sales.  The new Sears Auto Center franchise locations will provide the same products and services for automobiles, light trucks and motorcycles that are currently available at the nearly 850 company-owned Sears Auto Centers. Those products and services include:

• An extensive tire selection, including brands such as Michelin®, Goodyear®, BF Goodrich® and Bridgestone® and more
• Batteries from DieHard®, America’s most preferred automotive battery
• Maintenance and repair services for consumer and commercial fleets, including: oil changes, alignments, shocks, brakes, coolant/antifreeze, air conditioning, transmissions, fuel system cleaning and more
• Custom wheels, car care products, truck boxes, fluids, floor mats, DieHard battery chargers, DieHard portable power, XCargo® carriers and more

Additionally, many of the new franchise locations will be located on properties adjacent to pre-owned vehicle and body shop operations, making it even more convenient for customers to service their existing vehicle or shop for a new vehicle.

“The Sears Auto franchise is a win for customers and a win for dealers,” said Bill Jackson, Senior Vice President of Sears Holdings Corp. and President of Sears Authorized Independent Auto Centers, LLC.  “For customers, Sears Auto Centers will be more convenient than ever, with more locations providing our full product and service offerings.  This is also a great opportunity for dealers who are currently selling used cars to gain a brand that’s nationally recognized for quality and dependability, a resource for buying high-quality auto parts and supplies, and access to a proven business model that has been tailored to their needs.”

“We’re thrilled to join the Sears Auto Center network.  No other opportunity combined so many features that we needed as we sought to stabilize our business and position it for future growth,” said Bill Kendall, of Coleman Auto Group.  “Already, we’ve witnessed the level of support and care that Sears has invested in our success.  And we are ready to work hard to leverage the strengths that Sears brings to our existing relationships with customers.”

The new Sears Auto Center franchise model is available immediately to qualified dealers.  Sears will work with dealers to offer these advantages:

• Strength of the Sears brand and the ability to leverage Sears marketing, web presence and social networking
• Strength of the product brands, such as DieHard and Craftsman
• The purchasing scale necessary to achieve superior pricing on:
  • Product (tires, batteries, parts)
  • Equipment
  • Supplies
• Sears Card acceptance
• Systems and processes

“We are creating an opportunity to leverage Sears Automotive’s scale, business processes and brands so that dealers can build their businesses in service, parts and used vehicles,” Jackson said.  ”Our franchisees are great business people with years of experience in selling and servicing vehicles.  They have great facilities that need to be used to their fullest.  Together, we can provide each other a great opportunity to grow our businesses.”

About Sears Auto Center

Sears Auto Center is a leading provider of automotive maintenance and repair services and parts, with nearly 850 locations nationwide offering a full array of passenger and light truck tires, DieHard® batteries, Craftsman® auto accessories and more.  Sears has a long history as America’s trusted place for car care, having offered auto parts since 1905 and service since 1931.  Sears Auto Center offers customers convenient locations and hours, as well as an extensive menu of services.  Sears Auto Center is a division of Sears, Roebuck and Co.

About Sears Holdings Corporation

Sears Holdings Corporation is the nation’s fourth largest broadline retailer with approximately 3,900 full-line and specialty retail stores in the United States and Canada.  Sears Holdings is the leading home appliance retailer as well as a leader in tools, lawn and garden, home electronics and automotive repair and maintenance.  Key proprietary brands include Kenmore, Craftsman and DieHard, and a broad apparel offering, including such well-known labels as Lands’ End, Jaclyn Smith and Joe Boxer, as well as the Apostrophe and Covington brands.  It also has the Country Living collection, which is offered exclusively by Sears and Kmart.  We are the nation’s largest provider of home services, with more than 12 million service calls made annually.  Sears Holdings Corporation operates through its subsidiaries, including Sears, Roebuck and Co. and Kmart Corporation.  For more information, visit Sears Holdings’ website at www.searsholdings.com.

SOURCE Sears Holdings Corporation

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