News

Sears completes separation of Lands' End business

April 5, 2014

Sears Holdings Corporation has announced that its pro-rata spin-off of Lands' End, Inc. from Sears Holdings closed on April 4, 2014. According to the company, Lands' End has now been separated from Sears Holdings and its common stock is expected to begin regular-way trading on the Nasdaq Capital Market under the symbol "LE." Sears Holdings will continue to be listed on the Nasdaq Global Select Market under the symbol "SHLD." Sears Holdings received aggregate gross proceeds from the spin-off of $500 million, consisting of a cash dividend paid by Lands' End prior to the spin-off to a subsidiary of Sears Holdings.

In the spin-off, Sears Holdings distributed a total of approximately 32 million shares of Lands' End common stock to the holders of Sears Holdings common stock as of 5:30 p.m. Eastern time on March 24, 2014, the record date. Each share of Sears Holdings common stock outstanding as of the record date entitles the holder thereof to receive 0.300795 shares of Lands' End common stock, except that holders of Sears Holdings' restricted stock that was unvested as of the record date will receive cash awards in lieu of shares.

As part of the spin-off, Lands' End entered into an asset-based senior secured revolving credit facility, which provides for maximum borrowings of approximately $175 million with a letter of credit sub-limit, and a senior secured term loan facility of approximately $515 million. The proceeds of the term loan facility were used to pay the $500 million dividend to the Sears Holdings subsidiary and to pay fees and expenses associated with the foregoing facilities of approximately $10 million, with the remaining proceeds to be used by Lands' End for general corporate purposes.